Subscribe for Canara Robeco Asset Management Company Ltd IPO; Choice Equity Broking

IPO

Choice Equity Broking, Canara Robeco Asset Management Company Ltd

Canara Robeco Asset Management Company Ltd. (CRAMC), Incorporated in 1993 as Canbank Investment Management Services Ltd. to manage Canbank Mutual Fund’s assets, the company was fully owned by Canara Bank. In 2007, it became Canara Robeco Asset Management Company Ltd. following a joint venture with ORIX Corporation Europe N.V. (formerly Robeco Groep N.V.), with Canara Bank holding 51% and OCE acquiring a 49% stake. The company is India’s second-oldest AMC, primarily engaged in managing mutual funds and offering investment advisory services on Indian equities to Robeco Hong Kong Limited (“Robeco HK”), part of its Promoter Group. As of June 30, 2025, it managed 26 schemes including 12 equity, 10 debt, and four hybrid schemes with a quarterly average assets under management (QAAUM) of Rs. 1,11,052cr. This public issue is a solely comprise of OFS (Rs. 1,261.32 - 1,326.13cr). The company will not receive any proceeds from the OFS portion.

Valuation and Outlook

At the upper end of the price band, CRAMC is valued at a P/QAAUM of 4.8% and a P/E of 26.4x (based on TTM EPS of Rs. 10.1), indicating a fully priced valuation relative to peers. The company has demonstrated consistent growth, supported by Canara Bank’s extensive branch network of over 9,861 branches, which contributes around 8% of its total AUM. With a product mix dominated by equity-oriented schemes (~90% of AUM), the AMC remains well-positioned to benefit from rising retail participation in mutual funds. Thus, we assign a “Subscribe for Long Term” rating for this issue.

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Canara Robeco Asset Management Co - 091025 - choice