Operating profit decreased by 21.2% YoY to Rs. 301cr, with operating margin contracting 261bps YoY to 73.0%, impacted by fall in equity market. PAT reported at Rs. 302cr (+3.6% YoY) helped by higher other...

Equity flows remain subdued

HDFC AMC reported revenue decline of 18.4% YoY/down 13.6% QoQ to INR 411 Cr. EBIT declined by 15.5% QoQ / 21.1% YoY to INR 303 Cr. PAT improved 21.0% QoQ / 3.6% YoY to INR 302 Cr due to higher other income. PAT margin expanded from 52.5% in Q4 FY20 to 73.5% in Q1FY21. AUM improved 12.0% QoQ to INR 3,57,500 Cr. out of which 39% are equity oriented and 61% are non-equity oriented (Industry ratio stood at 38:62). Market share of total AUM declined to 14.0% in Q1FY21 from 14.7% in Q1FY20 Unique investors stood at 5.6 million comprising of ~26% share in the total MF industry...

HDFC Asset Management Company Limited (HDFC AMC) reported a weak quarter. Net revenue was down 18.4% YoY and 13.6% QoQ due to AUM mix change in favor of non-equity, which explains 80-85% of the drop in revenue. Annualized revenue yield was down ~8bps at 45bps (compared to FY20). QAAUM, at Rs 3,562bn, was down 2% YoY and 3.7% QoQ while the drop in the equity QAAUM was sharper at 21% YoY and 18% QoQ. Even though capital markets have been quite robust in 1QFY21, the drop in the equity AUM sequentially is explained by a combination of redemptions and higher exposure to small/midcaps (which had seen higher correction). In light of the lower-than-expected investment performance (as admitted by the...

Industry AUM declined to | 22.3 lakh crore as of March 2020 vs. | 26.5 lakh crore as of December 2019. Equity segment saw a decline of ~24% QoQ to | 8.3 lakh crore, led by correction in markets, debt & liquid schemes saw ~7%, ~11% QoQ decline in AUM due to outflows during the quarter. SIP...

HDFC Asset Management Company Limited (HDFC AMC) has reported a weak quarter of revenue and profitability on account of a sharp fall in equity prices in 4QFY20 and a generally risk-averse environment due to covid/lockdown. Even though QAAUM was up 8% YoY at Rs3,698bn, it declined on a sequential basis by 3.3%. On closing AUM basis, the decline was even sharper. Equity QAAUM stood at Rs1,574bn (up 2% YoY, down 5.5% QoQ), impacted by a relatively higher share of small/mid-cap focused funds which have seen a far sharper correction. With equity funds contributing as much as 70-75% to the topline, net revenue was down 2.1% YoY/9.3% QoQ. Adjusted for the one-time income on the PMS/SMA AUM in 3QFY20, the sequential decline in...

HDFC Asset Management (HDFCAMC) reported a ~Rs 500bn sequential AUM decline in Q4FY20, largely due to the mark-to-market effect.

Rise in profits, SIP inflow declines slightly HDFC Asset Management Company Ltd. (HDFC AMC) is one of the largest asset management companies (AMC) in India, with a total asset under...

The operational performance came in healthy in the quarter. Revenue from operation came in at | 525 crore, up 10% YoY; with revenue yield reported at 57 bps. Other income came in healthy at | 67 crore. Accordingly, total revenue was at | 592 crore, up 11% YoY. Expenditure was contained at ~| 126 crore with employee expense of | 57 crore. Accordingly, expense to AUM remained steady at 14 bps in Q3FY20 vs. 13 bps in Q2FY20. The...

HDFC Asset Management Company Limited (HDFC AMC) reported its 3QFY20 results with the key pointers being: (1) AUM growth was mostly in line with estimates; retain 18% forecast for FY20 (2) PAT growth strong; revise estimate upwards to account for higher other income (3) Individual equity key to profitability (4) Investing in tech as direct investing is on an uptrend (See comprehensive conference call takeaways on page 2 for significant incremental colour). Per se, on the key financials, HDFC AMC posted MF AUM growth of 12% YoY at Rs3,689bn, net revenue growth of 10% YoY at Rs5,247mn, EBITDA growth of 30% at Rs4,114mn and PAT growth of 45% YoY at Rs3,526mn. We have revised our estimates for FY20/FY21/FY22 and retained Accumulate...

HDFC AMC's equity-oriented AUM grew by 11.9% YoY in Q2FY20 to Rs. 1,651bn as against industry' growth of 12.7%, thereby, reducing its equity-oriented assets from 47.7% in Q1FY20 to 45.1% in Q2FY20. Actively managed equity-oriented AUM stood at Rs. 1,637bn with market share of 15.8% in Q2FY20 vs Rs. 1,689bn in Q1FY20 (market share of 16.2%), mainly due to change in product mix. Individual investors contributing Rs. 2,180bn to the present HDFC AMC's AUM represent 57.4% share as against 54.1% for the industry, making it the most preferred choice. The company has over one-fourth of industry total unique customers (5.5mn unique customers out of...

Revenue from operation came in at | 498 crore, up 4% YoY; revenue to AUM was down 3 bps QoQ to 54 bps due to higher inflows within debt & liquid funds. Other income was at | 51 crore. Accordingly, total revenue was at | 549 crore, up 6% YoY. Expenditure was contained at ~| 122 crore with employee expense of | 58 crore. Accordingly, expense to AUM improved marginally to 13 bps vs. 14 bps in Q1FY20. The company decided to shift to a lower tax regime. Accordingly, earnings saw 79% YoY growth to | 368 crore. The company continued to maintain its overall leadership in AUM,...

We have also reviewed recent mutual fund performance and are encouraged to find thatHDFCAMC has significantly improved its performancewith 64.9% (+1,280bps vs. Oct-18) of rated AUM now outperforming (rated 4 star +). RNAMC has slipped a bit, as only 36.1% (-1,700bps vs. Oct-18) of rated AUM is now outperforming. HDFCAMC has most efficiently passed on the TER cuts to distributors. Commissions now stand at 48bps (-29bps vs. Dec-18). Life insurance and mutual funds: Despite 1Q being a seasonally slow quarter, private life insurers individual NBPs grew a strong 28% YoY to Rs 92bn. On the other hand, equity (ex arbitrage and ETF) flows for 1QFY20 were muted at Rs 83.0bn (72% below FY19 avg). Higher life insurance sales vs. mutual fund sales may owe to changes in distributor commission payouts. While asset managers are not allowed to pay upfront commissions, insurers continue to pay out heavily. Our channel checks indicate this is tempting banks/national distributors to push insurance savings products.

Most profitable player in India's MF space HDFC Asset Management Company Ltd (HDFC AMC) is one of the largest Asset Management Companies (AMC) in India, manages a total Asset Under Management (AUM) of Rs2,920bn as on 31 st March 2018. Through organic and inorganic growth, the company has grown to one of the top 2 AMCs in the country and enjoys a robust AUM market share of about 14% in the industry. It is the most profitable AMC, in FY18 the company had reported PAT/AUM ratio of 0.25% while the other top 5 players had...

HDFC Asset Management Company Limited (HDFC AMC) operates as a joint venture between HDFC and Standard Life Investments Ltd. The company had total AUM of ` 2.92 tn (second largest with market share of 13.7%) as of FY18 with profits growing every year since the first full year of operations in 2002. In terms of equity oriented AUM and individual customer proportion, HDFC AMC has consistently been the largest AMC of India with market share of 16.8% and 15.7% respectively as on FY18. HDFC AMC has consistently been the most profitable AMC in India since FY13 owing to high proportion of equity oriented AUM, cost efficiency and diversified product mix distributed through a multi-channel distribution...

HDFC Asset Management Company is most profitable asset Management Company in India in terms of net profits since Fiscal 2013. As of 31 March, 2018, the company offered 133 schemes that were classified into 27 equity-oriented schemes, 98 debt schemes, three liquid schemes and five other schemes (including exchange-traded schemes and fund of fund schemes). The company had a total AUM of 2,919.85 billion as of March 31, 2018 and operates as a joint venture between Housing development Finance Corporation...

HDFC AMC is the asset management arm of HDFC Ltd. Promoted by HDFC Ltd. in 1999, Standard Life Insurance (SLI) acquired 26% stake in HDFC AMC in 2001. With organic growth and acquisitions (Zurich India and Morgan Stanley MF) the company has managed to be the market leader across industry parameters. The...

HDFC AMC has been the most profitable asset management company in India in terms of net profits since FY13. With a total AUM of Rs2,919bn as of March 2018, it commands a market share of 13.7% in the industry. The AMC offers a large suite of savings and investment products across asset classes which currently includes offering of 133 schemes classified into 27 Equity-oriented schemes, 98 Debt schemes, 3 liquid schemes and others. It is a play on fundamental transformation in the Indian savings environment. Household savings are witnessing a shift from physical assets to financial assets. The share of financial savings as a proportion of household savings has increased...

Kotak Mahindra Capital Company Limited, Axis Capital Limited, DSP Merrill Lynch Limited, Citigroup Global Markets India Private Limited, CLSA India Private Limited, HDFC Bank Limited, ICICI Securities Limited, IIFL Holdings Limited, JM Financial Limited, J.P. Morgan India Private Limited, Morgan Stanley India Company Private Limited and Nomura Financial Advisory and...

Established in 1999,HDFC AMC is a joint venture between HDFC and Standard life investments Limited.SLI is part of Standard Life Aberdeen plc., a global leading investment company. HDFC Offer Period AMC is the largest AMC in India in terms of equity AUM and amongst the top 2 in terms of total AUM, standing at INR 2.9 trillion as of FY18.The company has a diverse product base that has Price Band helped in targeting a large amount of individual customers with a total of 133 schemes as of FY18.The company remains the most profitable AMC in terms of net profits. HDFC AMC also provides portfolio management and individual account services on a discretionary as well as non discreBid Lot...