UTI Asset Management Company Ltd. share price target

UTI has fared better than peers when it comes to costs, considering a 5.9% standalone opex CAGR between FY22–26 (excluding VRS and labour code impact).

UTI AMC’s revenue from operations came in at INR3.8b (in line), reflecting flat growth on a YoY and QoQ basis. Yield on management fees came in at 38.6bp in 1QFY27 vs 42bp in 1QFY26 and 38.6bp in 4QFY26.

PAT came in lower in FY26, on account of higher employee expenses and impact of implementation of New Labour Codes

UTI AMC’s revenue from operations came in at INR 3.7b (in line), reflecting a growth of 4% YoY, but it declined 5% QoQ. Yield on management fees was 38.6bp in 4QFY26 vs. 42.4bp in 4QFY25 and 40.1bp in 3QFY26.

PAT came in below our estimates due to one-off VRS provisions and implementation of new labour codes

UTI AMC’s 3QFY26 operating revenue came in at INR3.9b (in line), reflecting a growth of 5% YoY/flat QoQ. Yield on management fees came in at 40.1bp in 3QFY26 vs 42.6bp in 3QFY25 and 41.2bp in 2QFY26.

PAT came in below estimate due to one-off employee costs and lower other income

UTI AMC’s 1QFY26 operating revenue stood at INR3.8b (in line), up 13% YoY/6% QoQ. Yield on management fees stood at 42bp in 1QFY26 vs. 43.4bp in 1QFY25 and 42.4bp in 4QFY25.

UTI AMC’s fund performance over the past five months has improved considerably, with an average of ~70% equity AUM appearing in Q1 and Q2 on a one-year return basis in May’25 vs an average of 25% in the preceding 12 months.

QoQ at 33.9bps. Equity performance in 1-yr bucket has been consistently improving since Mar'24, and 59% of equity AUM is in quartile 1 & 2 as of Mar'25. A dilution of 1-2bps is expected in yields which will be cushioned by commission rationalization carried out in Q4FY25. Staff cost is guided to grow by 3%/5% at the standalone/consol level; we envisage other opex to grow at an 11% CAGR...

Steady AUM Growth with Improving Mix and Profitability

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.

UTI Asset Management Company Ltd (UTI AMC), along with its group companies, is present across various business segments like Mutual Funds, Alternate Investment Funds, Pension Business and Portfolio Management Services. Considering the future growth visibility, we assign BUY rating with target price of Rs.1,489 per share.

Q4 QAAUM grew 22% YoY to Rs 2.9tn, but equity and hybrid schemes combined saw sustained outflows

NAM: Strong growth but upside capped cut to HOLD. APOLP: Disappointing result on all fronts. ITC: Cigarette and paperboard businesses disappoint. LT: Order inflow guidance raised; maintain BUY. NTPC: Normal quarter, aggressive expansion; maintain BUY. MRCO: Domestic business still lacklustre. UTIAM: Core earnings miss estimates. ASTRA: Mixed quarter, guidance broadly intact

UTI had reported strong 37% QoQ core EBITDA growth in Q2FY24 compared to 26% QoQ growth in Q1FY24. Operationally Q2FY24 saw sequential equity / total market share decline of 8bps / 13bps to 5.68%/4.31% on the basis of AAUM, along with a decline in SIP flow/AUM share.

Q2 AUM grew 14% YoY to Rs 2.7tn but equity and hybrid schemes saw cumulative outflows for the fourth straight quarter

While UTI reported strong 26% QoQ EBITDA growth in Q1FY24, there was sequential equity / total market share decline of 5bps / 9bps on the basis of ending AUM, along with marginal decline in SIP flow/AUM share. However, employee cost is now showing consistent signs of stabilising (broadly at INR 1bn levels for 5 quarters), which should help earnings growth. International and retirement subsidiaries offer good diversification.