HDFC Asset Management Q3 results preview: Here's what brokerages are expecting

HDFC Asset Management Company Ltd is set to announce its results for the quarter and nine-months ended on December 31, 2024 on Tuesday, January 14. Brokerage firms tracking the stock are expecting a strong performance from the mutual fund player considering the rising SIP inflows from the Indian investors.

Analysts tracking the counter are expecting a strong growth in net profit, revenue and Ebitda on a year-on-year (YoY) basis, while the numbers of quarter-on-quarter (QoQ) basis may increase in the single digits. However, margins are seen contracting marginally in the current quarter.

Motilal Oswal Financial Services (MOSL) pegs HDFC AMC's revenue from operations at Rs 911.3 crore, up 35.7 per cent YoY. Ebitda is seen coming in at Rs 721.8 crore with an ebitda margin of 79.2 per cent. Net Profit is likely to come in at Rs 606.7 crore, up 23.9 per cent YoY.

"It sees equity AUM to maintain growth momentum backed by improving fund performance, with likely to decline sequentially but scaling up of AUM to drive revenue growth. The consistent cost-to-income ratio with stable growth in operational expenses and weak market performance during the quarter hurt other income; likely to decline sequentially," MOSL added.

Equirus Securities expects HDFC AMC to report a revenue from operations to rise 38.4 per cent YoY and 4.7 per cent QoQ in the December 2024 quarter. Its core Ebitda came in at Rs 742.4 crore, up 45.2 per cent YoY and 5.5 per cent sequentially. PAT is seen at Rs 594.5 crore, up 21.4 per cent YoY and 3.1 per cent QoQ. Its revenue yield may contact 150 bps on a YoY comparison.

"We are building in a 4 per cent QoQ increase in QAAUM led by healthy growth in liquid and passive AUM while growth in equity AUM is likely to be lower than overall QAAUM growth. We are building in 0.4bps of revenue yield expansion for the quarter, with Ebitda growth of 5.5 per cent QoQ while other income is expected to decline materially at Rs 680 crore," it added.

B&K Securities is penciling a revenue of Rs 903 crore for the HDFC AMC in the third quarter of the ongoing financial year. The company's Ebitda margin may rise 82.1 per cent from 80.1 per cent in the year ago period. Its net profit is likely to come in at Rs 595.8 crore, up 22.1 per cent YoY and 3.3 per cent QoQ.

InCred Equities is jotting a revenue of Rs 966.5 crore for the quarter ended on December 31, 2024, likely to expand 8.94 per cent QoQ and 43.97 per cent YoY. It sees net profit at Rs 498.7 crore, increasing 31.29 per cent YoY and 11.44 per cent QoQ in the quarter.

Equirus Securities has a 'long' rating on HDFC AMC with a target price of Rs 5,425, while Motilal Oswal Financial Services has a 'buy' with a target price of Rs 5,200 crore. B&K Securities and InCred Equities, both have a 'hold' rating on the stock, with the latter one giving it a target price of Rs 4,750.