INSUBCONTINENT EXCLUSIVE:
With a rally of more than 4 per cent on Monday, shares of HDFC Asset Management Company traded at three times their issue price of Rs 1,100
The scrip scaled its fresh record high of Rs 3,336 in early trade on Monday.
A couple of recent developments have worked in favour of the
Also, MSCI’s index recast, including the company in MSCI Global Standard index, helped investor sentiment.
In another development, the
country’s biggest mutual fund house by assets under management (AUM) last month reported a 79 per cent rise in profit after tax at Rs
368.3 crore in the three months ended September 30, 2019
It had posted a profit after tax (PAT) of Rs 205.9 crore for the year-ago period.
Total income rose by 7 per cent to Rs 549 crore from Rs
515.3 crore in the same period of last financial year.
“HDFC AMC has been able to build a strong brand franchise due to strong parentage
and consistent returns in the past with top funds witnessing continuous flows
The company’s persistent focus on garnering high yielding retail AUM has led equity AUM growth to outpace overall AUM growth (27 per cent
CAGR vs 24 per cent) in FY14-19,” ICICIdirect said in a report.
KR Choksey Shares and Securities said HDFC AMC delivered a strong set of
numbers in Q2FY20 with modest top line growth but healthy improvement in margins backed by lower taxation expenses and lower fees and
commission expenses due to regulatory changes.
“We like HDFC AMC for its market leadership position (around 15 per cent market share)
supported by a strong brand presence through the HDFC group association
In our view, mutual funds industry in India is underpenetrated and offer long term growth prospects for channeling household financing
savings,” the brokerage said in a November 1 report.
It further said mutual funds have been growing at a rate higher than bank deposits
HDFC AMC is among the unique pure-play investment opportunities to take exposure to the mutual funds in India and a quality asset with a
credible track record, superior margin profile and healthy ROEs (>30 per cent).
