Buy

Steady AUM Growth with improving mix and profitability

HDFCAMC saw a soft quarter as core income missed PLe by 2.3% due to revenue being 1.7% lower led by weaker yields at 46.6bps (PLe 47.5bps) as (1) equity share fell QoQ to 60% from 61% to market correction in Feb'25 and (2) Q4FY25 has 2 lesser days (vs Q3FY25). Equity performance within the 3-yr bucket remains superior, which resulted in strong net flows' market share of 12.9% in FY25. New ESOP scheme of 2.5mn shares has been approved which is awaiting shareholder approval. Hence, we raise staff cost for FY26/27E by 7%/3%. Closing equity AuM for the industry corrected by 3.0% over Dec'24Mar'25 and markets continue to remain volatile. Equity flows for the industry...

HDFC AMC’s operating revenue was up 30% YoY/down 4% QoQ at INR9b (in line) in 4QFY25. Yields for the quarter came in at 46.6bp vs. 45.4bp in 4QFY24 and 47.5bp in 3QFY25. FY25 yields stood at INR35b, up 35% YoY.

Steady AUM Growth with Improving Mix and Profitability

Strong leadership and strategic growth driving investor expansion

Consistent performer in a growing industry

HDFC AMC is India's third-largest mutual fund house with QAAUM of INR7.9t. It holds an overall market share of 11.5% and a 12.8% share in actively managed equity QAAUM, underpinned by strong brand reputation, consistent fund performance, and an extensive distribution network.

space, drawing parallels US market from 1980s-2000s. Hence unique investors for the MF industry (52.6mn in Dec'24) can increase at a good pace. HDFCAMC will be a dominant player in this journey as its strong brand value is a function of its track record led by strong investment, risk and product management. Investor behavior is maturing as industry saw stable SIP flows during falling markets. Distributors have not objected to commission cuts as AuM growth...

Aditya Birla Sun Life AMC’s (ABSLAMC) 3QFY25 operating revenue grew 30% YoY to ~INR4.5b (5% beat), leading to a ~250bp YoY improvement in yield on management fees to 46.4bp (vs. our est. of 44.3bp). For 9MFY25, revenue grew 27% YoY to INR12.6b.

UTI AMC’s operating revenue grew 29% YoY to INR3.8b (in line). Yields remained flat YoY and QoQ at 42.6bp in 3QFY25. For 9MFY25, revenue grew 26% YoY to INR10.9b.