Larsen & Toubro (L&T), a Mumbai-based technology and engineering group, has launched fund-management operations through its purchase of DBS Chola Mandalam Asset Management Company (DCAM).

L&T's financial services subsidiary L&T Finance acquired DCAM and its subsidiary DBS-Chola Mutual Fund. The asset manager has been renamed L&T Investment Management and the fund house L&T Mutual Fund. The fund house has assets under management of Rs2,634 crores ($570 million) and offers 18 schemes spread over equity, fixed-income and liquid funds.

The firm will target institutions as well as retail investors, says Sanjay Sinha, chief executive of L&T Mutual Fund. "There is an existing relationship with a large number of institutional investors in India, which will be expanded with the new parentage," he says. "We are also scouting for segregated mandates and advisory accounts overseas."

The firm is in talks over potential new mandates, adds Sinha, but has been taking things slowly, pending completion of the regulatory formalities by the Securities and Exchange Board of India (Sebi).

The firm's 18 funds -- run by four portfolio managers based in India -- are currently available only in India, although they accept applications from foreign institutional investors registered with Sebi. The long-term plan is to offer dollar- and euro-denominated versions of popular funds under an appropriate structure overseas, says Sinha.

As for domestic distribution, Sinha says the fund house is committed to tapping the vast potential investor base spread across the country by increasing the network and distribution base in the coming months. L&T intends to expand its network to 41 centres by March and eventually to 55 centres, using as channels IFAs, national distributors, banks and stock exchanges.

Sinha was formerly DCAM chief executive and stayed on as head of L&T Mutual Fund. Before joining DCAM in September 2008, he was chief investment officer at SBI Mutual Fund. Sinha started his career with UTI AMC and was with the company for 16 years, before leaving in 2005 for SBI.

L&T Mutual Fund offers 18 schemes: nine equity (L&T Opportunities Fund, L&T Midcap Fund, L&T Tax Saver Fund, L&T Growth Fund, L&T Multi Cap Fund, L&T Global Advantage Fund, L&T Contra Fund, L&T Hedge Equity Fund and L&T Monthly Income Plan); three close-end equity (L&T Tax advantage Fund, L&T Small cap Fund and L&T Infrastructure Fund); and five debt (L&T Triple Ace Fund, L&T Short Term Floating Rate Fund, L&T Gilt Fund, L&T Liquid Fund, L&T Freedom Income-Short Term Fund and L&T Select Income Fund-Flexi Debt Fund).