Mumbai, Dec. 18 -- The Securities and Exchange Board of India's (SEBI) decision on Wednesday to overhaul mutual fund expense regulations is expected to enhance long-term investor outcomes, even as it creates near-term pressure on asset management companies (AMCs), according to a research analysis by Centrum.

From an investor standpoint, the withdrawal of the additional 5 basis points (bps) expense allowance linked to exit loads is a step toward reducing hidden costs and improving clarity around fund expenses.

While this move may weigh on AMC profitability in the short term, it strengthens the alignment between investor costs and actual fund management expenses.

The report estimates that, without mitigating actions, AMCs could see a cum...