HDFC AMC IPO – Details, Price Band, Analysis, Update

HDFC AMC – one of the largest and well-established asset management company in the country – is planning to raise INR 2,787.60 Cr / 2,800.33 Cr (all OFS) via initial public offer (IPO)

HDFC AMC – Company Profile

• Incorporated in the year 1999, HDFC Asset Management Company (HDFC AMC) Limited is well-known fund house in India engaged in providing savings and investment products.
• HDFC AMC is a joint venture between Housing Development Finance Corporation Limited (HDFC) and Standard Life Investments Limited (SLI)

HDFC AMC – Summary of Business

• HDFC AMC offers a large suite of savings and investment products across asset classes, which provide income and wealth creation opportunities to a large pool of customers.
• The Company also provides portfolio management (PMS) and segregated account services, including discretionary, non-discretionary and advisory services, to high net worth individuals (HNIs), family offices, domestic corporates, trusts, provident funds and domestic and global institutions.
• As of December 31, 2017, the company offered 127 schemes that were classified into 28 equity-oriented schemes, 91 debt schemes (including 65 fixed maturity plans (FMPs) and 3 liquid schemes, and 5 other schemes (including exchange-traded schemes and funds of fund schemes).
• HDFC AMC have been the largest Asset Management Company (AMC) in India in terms of equity-oriented Asset Under Management (AUM) since the last quarter of Fiscal 2011 and have consistently been among the top 2 asset management companies in India in terms of total average AUM since the month of August 2008, according to CRISIL.
• HDFC AMC have been the most profitable asset management company in India in terms of net profits since Fiscal 2013, according to CRISIL, with a total AUM of ₹2,932.54 billion as of December 31, 2017. Our profits have grown every year since the first full year of operations in Fiscal 2002.

HDFC AMC – Competitive Strengths

• Trusted brand and strong parentage
• Consistent market leadership position in the Indian mutual fund industry!
• Strong investment performance supported by comprehensive investment philosophy and risk management
• Superior and diversified product mix distributed through a multi-channel distribution network
• Focus on individual customers and customer centric approach
• Consistent profitable growth
• Experienced and stable management and investment teams

HDFC AMC – Strategies

• Maintain strong investment performance
• Expand our reach and distribution channels
• Enhance product portfolio
• Invest in digital platforms to establish leadership in the growing digital

Awards

HDFC AMC has received several awards for its operations, such as the Equity Fund House of the year award for 2017 at the Outlook Money Awards in 2018!

Promoters – HDFC AMC

• Housing Development Finance Corporation (HDFC) Limited, and
• Standard Life Investments Limited

Lead Managers / BRLMs

The book running lead managers (BRLM) are Kotak Mahindra Capital Company Limited, Axis Capital, BofA Merrill Lynch, Citi, CLSA, HDFC Bank, ICICI Securities, IIFL, JM Financials, J.P.Morgan, Morgan Stanley, and NOMURA while Karvy Computershare Private Limited is the Registrar to the Offer.

 

IPO Opening / Closing Date

IPO Details – Price, Minimum Bid and Other

HDFC AMC – Financial Performance

 

Revenues

HDFC AMC shows a steady revenue growth in last 5 years. Top-line has been increasing regularly for the last five years and jumped from INR 784 Cr in FY 2013 to INR 1588 Cr for the period ended FY 2017. (INR 1317 Cr till DEC 2017)

Profits

Though the company has shown a steady growth in revenue, the company has also registered growth in profits in these five years. Starting from INR 318.75 Cr of profits in FY 2013, the company’s earnings improved to INR 550.25 Cr for the period ended FY 2017. (INR 495.55 Cr till DEC 2017)

 

CONCLUSION –

Considering company’s valuation and financial parameters, FinBlab recommends SUBSCRIBE ratings on HDFC Asset Management Company Limited IPO

 

Also Read –

1) Finblab’s Valuepick Stock for the month of July 2018 – CEAT Limited

2) Ultratech Cement Limited Q1 Results Fy18-19

 

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