Hold Nippon Life India Asset Management; target of Rs 265: Sharekhan

Sharekhan's research report on Nippon Life India Asset Management

NAM India reported a 3%/ 2% y-o-y growth in core revenue and core PBT, respectively, in Q4FY23. Topline yields declined marginally to 0.475% vs 0.483% q-o-q. Dip in topline yield was driven by a higher share of ETFs. We believe top line yields are expected to be lower going forward as new lower yielding AUM replaces older higher yielding AUM. QAAUM grew by 4% y-o-y/flat q-o-q to Rs. 2,932 billion. It managed to hold equity market share q-o-q at ~6% however debt AUM declined by ~28% y-o-y. ETF AUM grew by ~32% y-o-y. SIP flows grew by ~11% q-o-q with market share at ~8%.

Outlook

At CMP, the stock trades at 18.8/ 17.9 its FY2024E / FY2025E EPS. We maintain Hold on NAM India with an unchanged PT of Rs. 265.