Buy Nippon Life India Asset Management, target price Rs 755: Axis Securities

Axis Securities has buy call on Nippon Life India Asset Management Ltd. with a target price of Rs 755. The current market price of Nippon Life India Asset Management Ltd. is Rs 710.

Nippon Life India Asset Management Ltd., incorporated in the year 1995, is a Large Cap company (having a market cap of Rs 43392.68 Crore) operating in Financial Services sector.

Nippon Life India Asset Management Ltd. key Products/Revenue Segments include Investment Management & Advisory Fees and Income From Portfolio Management Services for the year ending 31-Mar-2024.


Investment Rationale
With the lower penetration of mutual funds in India, NAM can continue to drive strong AUM growth. The company is one of the fastest-growing AMCs in B-30 cities.

We expect a 24/21/15% CAGR growth in AUM/Revenues/Earnings over FY24-27E. With a continued strong performance delivery and consistent market share gains, we believe NAM is a great bet amongst AMCs. We recommend a BUY with a target price of Rs 755, which implies an upside of 10% from the CMP.

Financials
For the quarter ended 30-06-2024, the company has reported a Consolidated Total Income of Rs 635.76 Crore, up 13.41 % from last quarter Total Income of Rs 560.57 Crore and up 34.98 % from last year same quarter Total Income of Rs 471.02 Crore. Company has reported net profit after tax of Rs 332.17 Crore in latest quarter.

Promoter/FII Holdings
Promoters held 72.66 per cent stake in the company as of 30-Jun-2024, while FIIs owned 6.56 per cent, DIIs 14.34 per cent.