SBI Funds Management IPO: SBI to sell 1.4% stake in pre-IPO offer; details you must know

In the latest update of its subsidiary SBI Funds Management (SBIFM) IPO, which opens on July 14, State Bank of India (SBI) on Thursday, in a filing to stock exchanges, said that it has entered into share purchase agreements to sell a 1.4156% stake in the company in the pre-IPO offering.

The stake will be sold to 30 investors for an aggregate consideration of ₹1,655 crore through a pre-IPO transaction.

SBI said it has signed agreements dated July 9 to sell 2,88,32,748 equity shares, representing 1.4156% of SBIFM's pre-offer share capital, at ₹574 per share.

The proposed transaction, valued at ₹1,655 crore, is subject to the fulfilment of conditions precedent under the respective share purchase agreements.

The development comes a day after SBI Funds Management filed its red herring prospectus (RHP) for its ₹11,693 crore initial public offering (IPO). The public issue is entirely an offer for sale (OFS) by promoters State Bank of India and Amundi India Holding.

Details to know

The proposed Pre-IPO transaction is expected to be completed by July 10, 2026, being 1 business day (i.e., any day excluding (i) Sunday; and (ii) any day which is a gazetted holiday or a day on which banks in India are required to be closed) following the execution date i.e., date of execution of each of the share purchase agreements.

Who are the investors?

The proposed pre-IPO stake sale will be made to 30 institutional and marquee investors, including 3P India Equity Fund 1, Malabar India Fund, Neo Secondaries Fund, Tata AIG General Insurance, Canara Robeco Arbitrage Fund, ARA Investments, 360 ONE Special Opportunities Funds, Akash Manek Bhanshali, Dymon Asia Multi-Strategy Investment (Singapore), Clarus Capital, and Capri Global Ventures, among others.

Collectively, these investors will purchase 2.88 crore shares of SBI Funds Management at ₹574 apiece, subject to the fulfilment of conditions precedent under the share purchase agreements.

SBI Funds Management IPO details

The company has fixed a price band of ₹545 to ₹574 per share for the issue. The IPO will open for subscription on July 14 and close on July 16, while the anchor investor bidding is scheduled for July 13.

According to the Red Herring Prospectus (RHP), SBI will offload up to 128,334,397 equity shares in the IPO through an offer for sale (OFS). The company's pre-offer paid-up equity share capital stands at 2,036,827,612 shares.

Based on these numbers, SBI is selling approximately 6.30% of SBI Funds Management's pre-issue equity capital. The calculation is as follows:

Since the IPO is entirely an OFS, the proceeds from the sale will accrue to the selling shareholder, SBI, and not to SBI Funds Management. SBI will continue to remain the majority shareholder in the asset management company after the completion of the IPO.

The IPO will see existing promoters SBI and Amundi India Holding offloading part of their holdings. According to the RHP, SBI will sell up to 128.33 million equity shares, while Amundi India Holding will divest up to 75.39 million shares.

At the upper end of the price band of ₹574 per share, the IPO is valued at ₹11,692.91 crore, making it one of the largest public issues in India's asset management industry.

Other key points to know

Upon listing, SBI Funds Management Ltd (SBIFML) will join other listed asset management companies, such as ICICI Prudential AMC, HDFC AMC, UTI AMC, Aditya Birla Sun Life AMC, Shriram AMC, and Nippon Life India Asset Management.

SBI Funds Management Ltd is a joint venture between SBI and Paris-based Amundi, holding 61.98% and 36.40% stakes, respectively.

The company is the country's largest asset management firm, with a quarterly average assets under management (QAAUM) of nearly ₹12.5 lakh crore as of December 2025.

SBI Mutual Fund, sponsored by SBI and established in 1987, was the first non-UTI mutual fund in India.