Wealth Manager 360 One Plans New Fund Amid Growth Drive

(Bloomberg) --

One of India's largest wealth managers is moving to capitalize on the country's free market haven, with plans to base a $200 million fund there managed by investor Ruchir Sharma.

Bain Capital-backed 360 ONE WAM Ltd. will raise cash from domestic clients for a feeder fund for the emerging markets-focused EM Revival Master Fund managed by Sharma's Breakout Capital, according to the firm's co-founder Karan Bhagat.

India's central bank recently introduced new rules allowing resident Indians to open foreign currency accounts at Gujarat International Finance Tec-City, seeking to make the financial hub more attractive to investors. Also know as GIFT City, the center has been a flagship project of Indian Prime Minister Narendra Modi.

The fund is 360 One's first to be denominated in dollars, open to Indian residents and based in the country. The Mumbai-based firm also plans to open offices in Dubai and three to four other locations popular with the Indian diaspora as they look to invest back in their home country, Bhagat said.

“It is early days but we will set up more funds for our clients in GIFT City, for money to come into the country and also to invest offshore,” Bhagat said. 

360 One manages about 4.6 trillion rupees ($55 billion) on behalf of roughly 2900 families in India. It already has feeder funds in Singapore that invest in offshore opportunities for resident Indians, he said. 

The fund's manager, Breakout Capital, named after Sharma's book Breakout Nations, is a partnership the Morgan Stanley veteran started with the backing of Rockefeller Capital Management when he joined the wealth manager in 2022. Sharma had been head of emerging markets and chief global strategist when he was at Morgan Stanley. 

Global, Local Opportunities

Bhagat is bullish on wealth management in India, where the number of individuals with more than $30 million of assets is expected to grow by 50% between 2023 and 2028, according to a Knight Frank wealth report. 

He cites second and third generation owners of family businesses who are looking to sell because their ambitions lay elsewhere, hence creating big liquidity events, as big opportunities. The country's booming startup scene is also accumulating wealth for employees, founders and investors, Bhagat said. 

Meanwhile, wealthy Indians living abroad are looking for ways to invest in the country, he said, leading to money managers adding staff in cities where they are concentrated. 

As well as expanding overseas, Bhagat said 360 One is looking to broaden the types of clients it serves in the country, where it currently has 28 offices in 14 cities.  

Since its 2008 founding, it has focused on individuals with more than 500 million rupees of wealth to invest. It's now shifting some relationship managers to focus on an even wealthier cohort, Bhagat said, and the scope of services they will offer will need to be broader. 

“They want personal bankers to effectively be investment bankers,” he said of those clients, adding that roughly 10% of its 240 relationship managers will exclusively service the segment.

Bhagat is also expecting wealth creation in India's smaller cities, and will begin to service clients in that segment too. “The big revolution in Tier 2, Tier 3 cities will happen in the 50 million rupees to 250 million rupees range,” Bhagat said. 

All of that should help the firm grow its profits by as much as 25% annually, according to Bhagat. “Obviously if you add 20%, 25% growth for three, four years, it becomes fairly large,” he said. 

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