Market cap is around 82K cr and AUM is about 575K cr. Typically AMC are valued at 5% of the AUM but HDFCAMC is around 14% now.
May be it deserves higher multiple for upcoming growth in AUM but with new entrants and rise of indexing net profit to AUM ratio will be trending downward. Currently AMC earns about 35 bps of profit for 100 of AUM. So valuation looks stretched. AUM will go down if correction is in the market.
I feel banks offers more barriers to entry compared to an AMC business.
Recently reduced position in HDFC AMC stock.
HDFC AMC has following section https://www.hdfcfund.com/information/amc-shareholder but links are not working for me. Overall they seem to be under investing in tech side of the business.
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