PL Capital Sees HDFC AMC, NAM, UTI Leading Q1FY26 AMC Growth; Cautions on Near-Term Valuations
- 9th July 2025
- 01:00:00 PM
- 4 min read
Mumbai | July 9 – India’s asset management companies (AMCs) are poised to report a robust Q1FY26, riding on a sharp equity market recovery and steady retail flows. Yet, PL Capital warns investors to watch for near-term caution as valuations have run up swiftly.
In its latest AMC earnings preview, PL Capital highlights HDFC AMC, Nippon Life India Asset Management (NAM India), and UTI AMC as well-positioned for growth, supported by expanding assets under management (AuM) and a resilient retail participation pipeline.
“We expect AMCs to post healthy growth this quarter, with equity AuM and profitability showing solid momentum. However, the recent rally in AMC valuations calls for cautious optimism,” said Gaurav Jani, Senior Analyst, PL Capital.
Equity Markets Lift AuM Across AMCs
The bounce-back in equity markets in May and June 2025 has driven a 7–8% QoQ rise in equity QAAuM for the industry, translating into a 21–22% YoY expansion. PL Capital notes that mark-to-market gains, combined with healthy SIP flows, supported this rebound despite the global volatility and US tariff-related uncertainties.
Company-wise Q1FY26 projections:
- HDFC AMC: Equity QAAuM to rise 7.7% QoQ, 21.8% YoY, reaching ₹5 lakh crore.
- NAM India: Equity QAAuM to grow 9.1% QoQ, 25.4% YoY, touching ₹2.77 lakh crore.
- UTI AMC: Equity QAAuM to expand 4.5% QoQ, 10.1% YoY, to ₹1.28 lakh crore.
“HDFC AMC and NAM India remain our top AMC stock picks given their strong retail franchise and scale, even as yield pressures persist in the short term,” said Aditya Modani, Analyst, PL Capital.
Financials: Steady Revenue, Yield Pressure, Rising Costs
PL Capital expects total revenue for its AMC coverage universe to grow 4.4% QoQ and 18.1% YoY in Q1FY26, driven by the higher AuM base. However, yield compression is likely due to telescopic pricing, a larger AuM denominator, and a marginal dip in equity mix for some players.
Operating expenses are projected to increase 5.4% QoQ, with staff costs rising 7.5% QoQ. HDFC AMC is likely to see a sharper rise due to ESOP charges.
Q1FY26 AMC Financials
| Metrics | HDFC AMC | NAM India | UTI AMC |
| Revenue (₹ Cr) | 942.5 (+4.6% QoQ) | 592.8 (+4.6% QoQ) | 373.6 (+3.7% QoQ) |
| PAT (₹ Cr) | 682.9 (+6.9% QoQ) | 366.4 (+22.8% QoQ) | 188.4 (+84.8% QoQ) |
| Core PAT (₹ Cr) | 561.3 (+3.2% QoQ) | 282.8 (+1.0% QoQ) | 118.2 (+20.7% QoQ) |
| QAAuM (₹ Lakh Cr) | 8.29 (+7.0% QoQ) | 6.13 (+10.0% QoQ) | 3.61 (+5.8% QoQ) |
| Equity QAAuM (₹ Lakh Cr) | 5.00 (+7.7% QoQ) | 2.77 (+9.1% QoQ) | 1.28 (+4.5% QoQ) |
| Core RoAAuM (%) | 0.27 | 0.19 | 0.13 |
“Revenue gains are supported by rising AuM, but yield compression and cost escalations remain watchpoints,” noted Harshada Gite, Analyst, PL Capital.
Stock Picks: HDFC AMC, NAM India Favoured
PL Capital has retained BUY ratings on HDFC AMC, NAM India, and UTI AMC with the following target prices:
- HDFC AMC:BUY, Target Price ₹4,600 – Strong SIP engine and execution
- NAM India:BUY, Target Price ₹700 – Lean cost structure, robust retail franchise
- UTI AMC:BUY, Target Price ₹1,300 – Consistent AuM growth, improving profitability
Cautious Optimism Amid Global Uncertainties
While Q1FY26 is likely to be a strong quarter for AMCs, PL Capital advises caution due to:
- Valuation run-up post equity market rally
- Yield compression amid telescopic pricing
- Global headwinds including US tariffs and demand uncertainty
Long-term, the financialisation of savings in India, robust SIP flows, and structural equity market growth remain key positives supporting the AMC sector.
“The AMC sector remains a structural growth story, and while near-term yields may moderate, the sector’s fundamentals remain intact,” PL Capital concluded.
The Bottom Line
Q1FY26 is shaping up as a robust quarter for India’s AMCs. HDFC AMC, NAM India, and UTI AMC are positioned to benefit from market recovery, even as the sector navigates near-term yield and cost pressures.
Investors tracking AMC stocks for long-term allocations can consider staggered entries, with PL Capital maintaining its BUY stance on HDFC AMC and NAM India as preferred bets in the space.
🔗 For a detailed breakdown of AMC sector trends, updated forecasts, and rating rationales,
click here to read PL Capital’s complete AMC Q1FY26 preview.
PL Capital
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
