Neutral Aditya Birla Sun Life AMC Ltd For Target Rs. 425 - Yes Securities Ltd
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Result Highlights (See “Our View” below for further elaboration)
* Revenue: Revenue from operations at Rs 3,112mn was up 4.8%/2.2% QoQ/YoY, lagging QAAUM growth of 7.9%/5.5% QoQ/YoY.
* Share of Equity in AUM: Share of Equity in AUM (including Hybrid funds) at 40% was down -222 bps QoQ and -173 bps YoY (calculated on rounded off figures)
* Share of B-30 in AUM: Share of B-30 in AUM at 16.0% was down -80 bps QoQ but up 10bps YoY
* Channel mix: Share of MFDs, Banks, NDs and Direct was 32%, 9%, 17% and 42%, respectively in overall AUM (Ex-ETF)
* Operating profit margin: Operating profit margin for the quarter, at 54.6%, was up 141 bps QoQ but down -501 bps YoY? Revenue: Revenue from operations at Rs 3,112mn was up 4.8%/2.2% QoQ/YoY, lagging QAAUM growth of 7.9%/5.5% QoQ/YoY.
* Share of Equity in AUM: Share of Equity in AUM (including Hybrid funds) at 40% was down -222 bps QoQ and -173 bps YoY (calculated on rounded off figures)
* Share of B-30 in AUM: Share of B-30 in AUM at 16.0% was down -80 bps QoQ but up 10bps YoY
* Channel mix: Share of MFDs, Banks, NDs and Direct was 32%, 9%, 17% and 42%, respectively in overall AUM (Ex-ETF)
* Operating profit margin: Operating profit margin for the quarter, at 54.6%, was up 141 bps QoQ but down -501 bps YoY
Our view – SIP traction worsens sequentially, Downgrade to NEUTRAL
Calculated overall revenue yield inched lower ~1bp sequentially: The decline in yield has been due to change in asset class mix. There has been a rise in the share of passive equity funds within equity due to mney from institutional investors. There was a minor decline in equity yield which was the result of which schemes saw a rise in AUM.
SIP business has been on a declining trend on sequential basis: This is because of a rise in cancellations in SIP accounts. The SIP closures have come materially from millennial investors who have come in relatively recently via online channels.
We downgrade ABSL from ‘ADD’ to ‘NEUTRAL’ rating with an unchanged price target of Rs 425: We value ABSL at 16.7x FY25 P/E, at which the stock would trade at an FY25 P/B of 3.7x.
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