Anvil PMS to shut shop amid regulatory glare

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Anvil Wealth Management (AWM) is winding down its portfolio management services (PMS) business, said two people in the know.

The decision to shut shop comes in the aftermath of SEBI’s interim order in March last year, which restrained six entities, including AWM’s fund manager Kaushal Chandarana, for their involvement in front-running trades of AWM.

AWM ran three strategies: Anvil Long Holding Strategy, Alpha 25, and Anvil Wealth Compounders, with assets totalling over over ₹1,300 crore at the end of April last year, data collated from industry body APMI showed. At the end of January this year, the combined assets of the three strategies have fallen to ₹189 crore. Anvil Long Holding Strategy, the largest scheme, has returned 21.3 per cent in the past five years and 18.3 per cent since inception.

The exit process was initiated a few months ago and may be completed before March 31, according to one of the persons. PMS investors were given three exit exit options: transferring securities to their accounts, receiving cash after selling the securities, or transferring holdings to Enam Asset Management..

Several clients have chosen the last option and migrated to Enam AMC, which is the largest PMS manager in the country with assets exceeding ₹39,000 crore. The AMC was co-founded by Vallabh Bhansali, Nemish Shah, and Jiten Doshi, who has served as its chief investment officer since 1997.

AWM was created in 2008 as a wholly-owned subsidiary of Anvil Share and Stock Broking to offer PMS. The latter was founded in 1989 by Anuj A Sheth, Shah’s nephew, as a proprietary concern. In 1997, it emerged as a corporate entity. Doshi joined hands with Anvil in 2001.

AWM’s disclosure document, however, states that the Anvil Group has initiated an internal restructuring, making Takshil Financial Services the 100 per cent holder of AWM, with Sheth and Nimesh Doshi as the ultimate beneficiaries.

“Most owners would have sold off the business due to its long history, but instead, they have made a strange decision to wind it up,” said an industry official. “Many promoters are worried about getting caught up in regulatory issues and the SEBI order could have influenced the decision.”

In its interim order last year, SEBI had observed that Banhem Stock Broking and Ninja Securities traded in different securities ahead of the impending orders placed on behalf of AWM. It noted that Manish Mehta, a common director of Ninja and Banhem, was connected with AWM portfolio manager Chandarana.

AWM’s disclosure document states that there are no pending litigation or proceedings initiated by any regulatory authority against the portfolio manager or any of its directors or employees. Furthermore, it states that it has taken action, suspending the concerned employee mentioned in the SEBI interim order and has submitted the relevant details to SEBI.

An email sent to AWM and Enam AMC, as well as a text message to Jiten Doshi, did not receive a response.

Last year, Morningstar Investment Adviser India, a wholly-owned subsidiary of Morningstar Investment Management, LLC, discontinued its PMS offering, which was introduced in April 2019.

This is as good a time to be a PMS manager as any, given the surge in mid- and small-cap shares in the past year, said experts. The majority of the 300-odd PMS schemes outperformed the benchmark Nifty 50 and Nifty 500 in CY23.

In a spot

  • SEBI’s interim order in 2023 implicated six entities, including AWM’s fund manager, in front-running
  • AWM’s three strategies had assets totalling over ₹1,300 crore as of April 30, 2023
  • Assets have slid to ₹189 crore
  • PMS investors were given three exit options
  • Several clients have opted to transfer their holdings to Enam AMC