Nippon Life India Asset Management Ltd. share price target

We maintain our BUY recommendation on the stock

NAM saw a stable quarter as core numbers i.e. QAAuM and core income were in-line. Overall and equity QAAuM declined by 2.2%/5.1% QoQ owing to equity market correction in Feb'25. As a result, equity share fell by 137bps QoQ leading to fall of 0.6bps in blended yields. As per the company, commission has been rationalized for 45-50% of equity AuM. Market share in net equity flows (exNFO) continues strong in FY25; it was 10.6% (11.8% in FY24) and reduction was lower than larger peers. Closing equity AuM for industry corrected by 3.0% over...

Nippon Life India AMC (NAM)’s operating revenue grew 21% YoY to INR5.7b (in line) in 4QFY25. Yields declined to 40.7bp from 41.3bp in 4QFY24. NAM’s FY25 revenue came in at INR22.3b, recording a growth of 36% YoY.

Core performance was healthy and in line with expectations in Q4FY25. Core revenues grew by 21.0% y-o-y/ down 4% q-o-q to Rs. 567 crore in Q4. For FY25, core revenue grew by 36% y-o-y. Overall, AUM reached Rs 6.5 lakh crore (up 25% y-o-y/ flat q-o-q), while MF QAAUM rose by 29% y-o-y / down 2% q-o-q.

Strong leadership and strategic growth driving investor expansion

We maintain our BUY recommendation on the stock

Nippon Life India AMC (NAM)’s operating revenue came in at INR5.9b (in line), resulting in a growth of 39% YoY and 3% QoQ. Yields declined to 41.3bp in 3QFY25 from 41.6bp in 2QFY25 and 44.8bp in 3QFY24. For 9MFY25, revenue came in at INR16.6b, recording a growth of 42% YoY.

We maintain our BUY recommendation on the stock

Core revenues grew 44% y-o-y/ 13% q-o-q driven by strong growth in mutual fund AUM (up 57% y-o-y/ 14% q-o-q). Overall AUM reached Rs 6.5 lakh crore (up 50% y-o-y). Blended revenue yields were at 42 bps stable q-o-q and lower by 4 bps y-o-y.

Strong retail flows led by buoyant equity markets and launch of new/innovative passive
schemes is driving strong performance.

Quarterly Update Q1FY25

We revise our rating from HOLD to BUY.

NAM India reported yet another strong quarter led by buoyant capital market flows. Core revenues grew by 43% y-o-y/ 8% q-o-q to Rs. 505 crore, while quarterly average assets under management (QAAUM) rose by 54% y-o-y /12% q-o-q.