HDFC Asset Management Company Ltd. share price target

3QFY25 operating revenue grew 39% YoY/5% QoQ to INR9.3b (in line with est.). The sequential growth was driven by AUM growth and a 0.7bp QoQ improvement in yield to 47.5bp (1.1bp YoY decline)

In Q2FY25, revenue stood at INR 8,872 Mn, an increase of 38.0% YoY/ 14.4% QoQ, led by strong AUM growth and sequential improvement in blended yields. Revenues were 2.3% better than our estimates.

In Q1FY25, revenue growth stood at INR 7,752 Mn, an increase of 34.9% YoY/ 11.5% QoQ, led by strong AUM growth and sequential improvement in blended yields. Revenues were in line with our estimates.

In Q4FY24, revenue stood at INR 6,954 Mn, an increase of 28.6% YoY/ 3.6% QoQ. Revenues were 6.3% lower than our estimates due to the fall in blended yields.

Higher equity share drove strong overall QAAUM growth of 36% YoY in FY24; expansion in equity QAAUM market share a key positive

High Conviction Stocks Idea

As of December 31, 2023, the QAAUM stood at INR 5,515 Bn, reflecting 24.0% YoY/ 5.1% QoQ growth owing to the optimism seen in the capital markets over the past few quarters. The Company’s unique investor base stood at 8.7 Mn as against 42.0 Mn unique investors in the industry.

Actively managed equity QAAUM grew 40% YoY, driving 24% AUM growth in Q3; topline growth strong at 23%

As of September 30, 2023, the QAAUM stood at INR 5,247 Bn, reflecting a 22.2% YoY/ 3.0% QoQ growth led by positive market movement in the equity segment and good response for the newly launched funds during the quarter. The company's investor base has seen a healthy expansion by adding 1.8 Mn unique investors in September 2023, taking the base to 7.9 Mn unique investors.

HDFC AMC reported 22-quarter high EBITDA of INR 4.82bn in Q2FY24 driven by 29.6% end-to-end equity AUM growth in H1FY24. Improvement in fund performance is leading to superior business metrics such as gain in equity market share, unique investor share, and gain in flow market share in equity segment across channels.