HDFC AMC in Focus: Motilal Oswal Sets New Stock Target...

Synopsis: Shares of this AMC company surged 5 percent following strong Q4 performance, supported by robust SIP inflows and growth in assets under management, boosting brokerage optimism.

This article outlines the bullish stance of brokerages on this Asset Management Company, which offers a wide range of investment options, including Equity, Fixed Income, Hybrid, and Multi-Asset Solutions. After a strong Q4, where QAAUM rose by 19.8 percent year-on-year, supported by robust SIP inflows and steady operating performance.

With a market capitalization of Rs 1,19,195 crore, HDFC Asset Management Company Ltd’s shares on Friday made a day high of Rs 2,792.65 per share, up by 4.8 percent from its previous day’s close price of Rs 2,662.60 per share. The share of the company has given a return of 89.49 percent over the last 5 years.

Brokerages Views

Motilal Oswal Financial Services maintains a Buy rating on HDFC Asset Management Company with a target price of Rs 3,170, implying an upside potential of around 20 percent from previous close, supported by steady growth outlook.

Rationale:

Non-MF business to support growth: Motilal Oswal Financial Services expects HDFC Asset Management Company to see incremental growth led by non-mutual fund segments. This is likely to diversify revenue streams and reduce dependence on equity-oriented mutual fund inflows.

Stable share with steady earnings growth: The brokerage highlights a broadly stable market share across segments. It estimates FY26 to 28 revenue CAGR of 13 percent, EBITDA CAGR of 14 percent, and PAT CAGR of 15 percent, supported by around 16 percent AUM growth and improving operating leverage.

Morgan Stanley maintains an Overweight rating on HDFC Asset Management Company, raising its target price to Rs 2,975 from Rs 2,915, indicating a positive outlook supported by steady growth prospects and improving earnings visibility.

Steady operating performance: Morgan Stanley notes that HDFC Asset Management Company’s operating performance remains broadly in line with expectations, indicating stable execution and consistent business momentum across key segments.

Strong SIP flows supporting growth outlook: The brokerage highlights robust SIP inflows, which are expected to support AAAUM growth of 9 percent in FY27 and 37 percent in FY28. It also projects earnings growth of 11 percent in FY27 and 35 percent in FY28, reflecting improving scalability.

Jefferies maintains a Buy rating on HDFC Asset Management Company and raises its target price to Rs 3,090 from Rs 2,960, reflecting a positive outlook driven by steady flows, earnings visibility, and improving operating performance.

Steady Q4 with earnings beat: Jefferies notes that HDFC Asset Management Company delivered a Q4 performance broadly in line with expectations, with a PAT beat of 5 percent driven by higher other income, while steady flows continue to support valuations.

TER impact manageable: Management expects a 3–4 bps impact from revised TER norms; however, this is likely to be offset through operational efficiencies and better commission management, helping sustain margins and maintain overall earnings trajectory.

Business highlights:

Strong AUM growth and market position: HDFC Asset Management Company reported QAAUM of Rs 9,275 billion for the quarter ended March 31, 2026, up from Rs 7,740 billion year-on-year, with an 11.4 percent market share. Actively managed equity QAAUM stood at Rs 5,657 billion, with a strong 13.0 percent share.

Favourable mix and strong retail participation: The equity to non-equity QAAUM mix stood at 65:35, higher than the industry’s 56:44, reflecting a stronger equity tilt. Individual investors contributed 68 percent of total AUM versus 60 percent for the industry, indicating strong retail participation and a stable investor base.

Wide distribution and growing customer base: The company processed 16.5 million systematic transactions worth Rs 48.8 billion in March 2026. It has over 1,09,000 distribution partners and 280 offices, with strong reach in B-30 locations. Total live accounts stood at 30.2 million, with 16.7 million unique customers.

About the Company

HDFC Asset Management Company Limited (HDFC AMC) is a leading Indian investment manager for HDFC Mutual Fund, one of the country’s largest mutual fund houses, established in 1999. Offers a wide range of investment options, including Equity, Fixed Income, Hybrid, and Multi-Asset Solutions.

Financial Highlights: The revenue from operations grew by 17 percent to Rs 1,050 crore in Q4 FY26 from Rs 901 crore in Q4 FY25, and EBIDT grew by 16 percent to Rs 846 crore in Q4 FY26 from Rs 731 crore in Q4 FY25. This was accompanied by a net profit decline of 2 percent to Rs 623 crore in Q4 FY26 from Rs 639 crore in Q4 FY25, resulting in an EPS decline of 3 percent to Rs 14.55 per share in Q4 FY26.

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