HDFC AMC

The mutual fund industry experienced a challenging year with Nifty 50 down 5%, including a 14.5% drop in the March quarter. Despite this, domestic investors demonstrated maturity, with equity-oriented funds attracting INR1,340 billion in the March quarter. Monthly SIP collections reached an all-time high of INR321 billion in March 2026, a 24% YoY increase, with 97 million contributing accounts. The industry added 7.2 million new investors, bringing the total investor base to 61.4 million.

HDFC AMC reported a strong Q4 FY26, with overall Quarterly Average AUM (QAAUM) growing 20% YoY to INR9.3 trillion, and equity-oriented AUM reaching INR6 trillion. Revenue from operations increased 18% YoY to INR41.2 billion, leading to an operating profit of INR32.1 billion, also up 18% YoY. Profit after tax stood at INR28.6 billion, a 16% YoY growth. The company declared a dividend of INR54 per share, representing an 81% payout ratio.

The company is committed to becoming a 'digital AI wealth creator for every Indian,' with 97% of its transactions already digital, up from 81% three years prior. AI is being embedded across marketing, client engagement, investment processes, risk management, and compliance to act as a 'force multiplier.' To strengthen this, the Board approved the appointment of Mr. Rajan Anandan, a global technology leader, to its Technology Committee.

HDFC AMC made significant progress in diversifying beyond traditional mutual funds. It achieved the first close of its private credit fund with IFC as a partner and anchor investor. In its international business based out of Gift City, the company launched two new inbound funds, bringing the total to five. Additionally, its PMS business secured two marquee mandates from EPFO and SPFO for fixed income.

Management emphasized running a 'very tight ship,' with employee costs (excluding ESOPs) growing approximately 12.5% YoY and non-employee costs showing a CAGR of about 13.5% over five years. Regarding the new BER (Base Expense Ratio) regulations, the gross impact on the existing book is estimated at 3-4 basis points, which the company plans to largely offset through commission structure optimization and prudent cost management, aiming for a non-material impact on P&L.

The company is pursuing a 'phygital' strategy, expanding its physical branch network while enhancing digital capabilities. It focuses on broad-based growth across all channels, including mutual fund distributors, national distributors, banks, and fintech platforms. Unique investors grew by 3.5 million to 16.7 million, with a significant contribution from B30 locations and fintech channels, reflecting deep market penetration and a focus on long-term investor engagement.

HDFC AMC maintains a well-rounded product bouquet across most SEBI categories, with an aspiration to grow market share and deliver good returns. New product launches will be highly selective, focusing on thematic/sector or passive spaces backed by strong conviction and clear market opportunity. The company remains a strong believer in active investing, viewing the Indian market as a 'stock pickers' paradise' for generating alpha through disciplined research and processes.