HDFC Asset Management Company

Among the listed AMCs you have HDFC, Nippon, Birla and UTI. While UTI and Birla are relatively undervalued, they are having challanges wrt growth –particularly of equity AUMs. Clearly this is a sector which will provide high returns because

• Mutual Funds are now accepted by more and more people for their investments
• All the growth in equity indices get reflected in the growth in AUM (for example if Nifty doubles in say 5 years, the equity AUMs will grow even without further inflows)
  -The incremental costs of managing higher amounts is very low, thus margins will improve with rising AUMs
• The SIP book for the industry is rising every month
  Overall wealth and asset management industries are sunrise sectors