Updates to add details and background throughout

July 21 (Reuters) - SBI Funds Management SBIA.NS jumped 8.8% in its trading debut on Tuesday, becoming India's second-largest asset manager by market capitalisation, as investors bet on growth prospects in the country's $853 billion asset management industry.

The stock climbed to 624.3 rupees, valuing the asset manager at 1.26 trillion rupees ($13.08 billion). Peers ICICI Prudential Asset Management Company IICL.NS and HDFC Asset Management Company HDFA.NS were valued at 1.54 trillion rupees and 1.13 trillion rupees, respectively.

SBI Funds Management, a joint venture between State Bank of India SBI.NS, the country's largest lender, and Amundi AMUN.PA, Europe's biggest asset manager, oversaw assets worth 12.5 trillion rupees as of March 2026, making it India's largest asset manager.

The asset manager drew bids worth $31 billion last week for India's largest IPO so far this year, including $278.5 million raised from anchor investors such as BlackRock and sovereign wealth funds from Singapore, Abu Dhabi and Norway.

"As the savings and investment needs of Indians evolve, the middle class is increasingly embracing mutual funds as its core investment vehicle, and SBI AMC has all the ingredients to become "the asset manager to every Indian," just as its parent has become "the banker to every Indian", said analysts, who were led by Emkay Global Financial Services' Avinash Singh.

($1 = 96.3350 Indian rupees)