ôRatneshÆs addition to the senior management team at Anand Rathi will significantly propel the firmÆs positioning in the growing institutional equities business," says Amit Rathi, managing director at Anand Rathi.
Kumar has more than 15 years of experience in the Indian institutional equities business. He joined Citi as head of research and was part of a team which developed Citi's India research capabilities. Kumar had been with the US bank for nearly eight years, most recently as a managing director and Citi's India equity strategist. Under KumarÆs leadership Citi achieved high ratings for its India research in both 2006 and 2007.
Before he joined Citi, Kumar worked with CLSA India. He started his career in equities with another Indian firm, SSKI, in 1993.
Citi has appointed Aditya Narain, an associate director in the equities research team to replace Kumar as head of research for India. Narain joined Citi in 2000 and covers financials and real estate. It also promoted Rahul Singh, who covers oil and telecoms, to the level of associate director of research.
Anand Rathi provides a range of financial services including investment banking, corporate advisory and brokerage. It is a leading wealth manager, an area which is growing in India with increasing disposable incomes among the countryÆs upper class. The firm was founded in 1994 by Anand Rathi and Pradeep Gupta.
Domestic firms like Anand Rathi and India Infoline are managing to attract senior talent from international firms by offering them incentives like equity ownership.
Further, Indian equity markets are no longer largely driven by foreign inflows. In 2007, investment in the stockmarket from domestic insurance companies, mutual funds and retail investors was more than 1.5 times that by foreign institutional investors. Global relationships are thus no longer key for brokerage firms to win business.
The most commonly used Indian stockmarket index, the Sensex, has been volatile this month. It touched a high of 21,000 and then started losing ground as nervousness due to subprime-related bad news started to take its toll. It fell to 16,000 before recovering and closed at 18,115 on Friday. Analysts and investors are still bullish on Indian equities as the economy is perceived to be primarily driven by domestic consumption thus not as vulnerable to a US slowdown as some other Asian countries. But picking stocks has never been more difficult with uncertainties persisting and valuations still running high.
Kumar will have his work cut out for him to ensure his new clients at Anand Rathi benefit as much from his expertise as his old clients at Citi have no doubt already done.
In an interesting coincidence, Citi Venture Capital (CVC) acquired a 19.9% equity stake in Anand Rathi in 2007. CVC did not disclose how much it paid, but media speculated it was around $25 million, which would place an equity value of around $125 million on Anand Rathi.