Portfolio managers need to modernise onboarding, reporting, and client engagement through digital solutions to stay competitive, Sebi chief Tuhin Kanta Pandey said on Wednesday.

Addressing the annual conclave of the Association of Portfolio Managers in India (APMI), the Sebi chief also urged the industry body to curb misleading claims being made by a few registered portfolio managers.

"The PMS (Portfolio Manager Services) industry needs to modernise onboarding, reporting, and client engagement through digital solutions to stay competitive and trusted," the Sebi chief said.

Stating that the PMS industry is at an inflexion point, he said, "You have a powerful position in place, a flexible regulatory framework, active industry engagement through the Association, and a rising pool of informed investors.".

According to the market regulator, the number of registered portfolio managers rose from 361 at the end of FY21 to 479 as of June 30, 2025.

During the same period, the total client base grew at a compounded annual growth rate of 12 per cent with discretionary PMS clients growing at 13 per cent annually and now making up about 96 per cent of all clients, Pandey said.

Discretionary AUM (assets under management), which is non-ETFO PF, grew 23 per cent annually, indicating increased client preference to delegate active management of their portfolios, he said, adding this AUM also makes up over 40 per cent of the organically sourced AUM, a sign of client trust in the industry.

He said that while non-discretionary and advisory client counts have declined, their AUMs have risen.