Buy Reliance Nippon Life Asset Management; target of Rs 350: JM Financial

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26 Aug, 2025 12:21

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JM Financial's research report on Reliance Nippon Life Asset Management

We initiate coverage on Reliance Nippon Life Asset Management (RNLAM) with a BUY rating and a target price of INR 350, valuing the company at 28x FY20E earnings (at CMP stock trades at 36x/ 29x FY18E/ FY19E). We believe RNLAM remains in a favourable position to capitalise on twin trends: a) mutual fund (MF) industry tailwinds as inflows remain strong and b) benefits of its own retail distribution franchise. RNLAM is one of the largest asset managers in India (3rd by MF AUM as of Nov’17) and second largest in terms of AUM contributed by individuals (13.6% market share of retail AUM as of 1HFY18).

Outlook
We expect RNLAM to record 21% AUM CAGR and 24% earnings CAGR over FY17-20, along with a rich 65% dividend payout ratio, which would drive stock returns.
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