InvestorQ : What is the reason that India Nivesh was forced to shut down its portfolio management (PMS) business? What happens to the investors now?
Juvina Maggie made post

What is the reason that India Nivesh was forced to shut down its portfolio management (PMS) business? What happens to the investors now?

Answer
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Angel dcosta answered.
7 months ago


The PMS of India Nivesh reportedly had some major exposures to some vulnerable companies that have corrected sharply in the last few weeks. In fact, it is reported that the flagship Sprout Small Cap Fund of India Nivesh saw its AUM falling by 1/3 from Rs.90 crore to Rs.60 crore. Now India Nivesh has given an option to its PMS holders that they can either take the market value of the investments or they can be given credit in their demat accounts of the shares that they have purchased in their demat accounts. Of course, PMS being a high risk venture, the losses would belong to the clients of the PMS. Markets have also been talking about India Nivesh exiting the retail and the institutional broking due to the deep losses incurred. The borrowings of the company went up nearly 7-fold to Rs.828 crore in the last 3 years and the inability to service the debt is considered to be one of the reasons the company has been forced to wind up its operations.