UTI AMC — Q4 FY26 earnings call

Call held 28 Apr 2026

Management summary

UTI AMC reported a resilient Q4 and FY26, marked by strong AUM growth, significant new investor additions, and robust SIP contributions. The company achieved substantial efficiency gains through digital transformation and maintained a high dividend payout. However, consolidated profitability saw a decline, and employee costs rose due to strategic investments. The international business faced macro-economic headwinds, and equity net flows remained negative, prompting a strategic focus on SIP growth and product diversification.

Highlights

  • Total AUM for the group stood at Rs 23.42 lakh crores as of March 31, 2026.

  • Mutual Fund AUM reached Rs 3.88 lakh crores, a 14.45% increase compared to Rs 3.39 lakh crores last year.

  • 7.16 lakh new investors (PANs) were added in FY26, bringing the total folio base to 1.38 crores.

  • Monthly SIP contribution reached Rs 32,087 crores in March 2026, with SIP AUM at Rs 15 lakh crores.

  • Digital business initiatives resulted in a 234% increase in revenue, 33% increase in transactions, and a 31% reduction in cost per transaction.

Concerns

  • Consolidated Normalized Core PAT for FY26 decreased by 8.13% YoY to Rs 452 crores.

  • Consolidated employee expense for Q4 FY26 increased by 13.79% YoY to Rs 132 crores, even after VRS, due to variable pay, incentives, and recruitment.

  • Equity net flows were negative on both quarterly and yearly bases, though moderating.

  • International business faced significant headwinds from global investor outflows ($40 billion from India) and currency depreciation.

Key financials

2 periods

Headline

  • Total Group AUM
    ₹2.34L Cr
  • Mutual Fund AUM
    ₹3.88L Cr
    YoY +14.4%
  • Standalone Core Income
    ₹1,255 Cr
    YoY +6.4%
  • Standalone Normalized Core PAT
    ₹460 Cr
    YoY +2.9%
  • Consolidated Core Income
    ₹1,539 Cr
    YoY +6.5%
  • Consolidated Normalized Core PAT
    ₹452 Cr
    YoY -8.1%
  • New Investors (PANs) FY26
    ₹7.16 lakh
  • Monthly SIP Contribution (March 2026)
    ₹32,087 Cr

Q4

  • Consolidated Employee Expense
    ₹132 Cr
    YoY +13.8%

What they filed

Q1 FY27: revenue up 6.8%, net profit up 15.7% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue538 418 376 547 419 −22%517 +24%390 +4%584 +7%
EBITDA348 233 169 340 177 −49%302 +30%-12 −107%383 +13%
Net profit263 174 102 254 132 −50%138 −21%-51 −150%294 +16%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

Share of AUM
₹8.11L Cr Total
  • UTI Pension Fund ₹4.02L Cr 49.5%
  • UTI Mutual Fund ₹3.88L Cr 47.8%
  • UTI International ₹16,144 Cr 2.0%
  • UTI Alternatives ₹5,280 Cr 0.7%

Capital allocation

high confidence
  • Dividend ₹40/share (final) Payout ratio 95%
    I am also pleased to inform you that at the board meeting today, UTI AMC has declared a dividend of Rs. 40 per share for the Financial Year '25-26. The same is subject to the approval of shareholders at the ensuing Annual General Meeting. ... if you look at the trend line, I think including what we have just announced today, which is Rs. 40, I think roughly we are at about 95% almost in terms of a trend line.
  • Liquidity Cash ₹4,000 Cr Company holds almost Rs. 4,000 or Rs. 4,500 crores of cash and investment on its consolidated book, deemed sufficient for corporate optionality.
    My question is to Vetri Sir. So, I want to understand more of balance sheet perspective. We hold almost Rs. 4,000 or Rs. 4,500 crores of cash and investment on our book at consolidated level... our basic view that there is no need to add any more cash on our books. We have enough liquidity for any corporate optionality that we might want to preserve.

Guidance & targets

Employee Cost

  • Standalone Employee Cost Run Rate Employee Cost · per quarter for next financial year · High confidence Rs 90-95 crores
    the run rate on a quarterly basis should be around Rs. 90 crores to Rs. 95 crores for the standalone entity

    — Vinay Lakhotia

  • Consolidated Employee Cost Run Rate Employee Cost · per quarter for next financial year · High confidence Rs 125-130 crores
    and Rs. 125 crores to Rs. 130 crores on the consolidated firm.

    — Vinay Lakhotia

Expenses

  • Standalone Other Administrative Expenses Growth Expenses · next financial year · Medium confidence 7-8%
    The guidance for the other administrative expenses, it should increase close to around 7% to 8% for the standalone entity

    — Vinay Lakhotia

  • Consolidated Other Administrative Expenses Growth Expenses · next financial year · Medium confidence around 10%
    for the consolidated one, it could be in the range of around 10%.

    — Vinay Lakhotia

Profitability

  • Overall Yield Dilution Profitability · FY26-27 · Medium confidence 1-2 basis points
    So, maybe a basis point or two dilution could be there because ETF and index fund is going at a slightly higher yield.

    — Vinay Lakhotia

Customer Acquisition

  • New Customer (PANs) Growth Customer Acquisition · this year (FY27) · Medium confidence significantly

    From 7 lakh (FY26) today

    I mentioned that last year, we added 7 lakh PANs. So, this year, we are targeting to grow that number significantly.

    — Vetri Subramaniam

Product Launches

  • SIF Category Fund Launch Product Launches · during the current year (FY27) · High confidence one fund
    But we think we have one or two good product ideas and certainly we would like to launch one of them during the current year.

    — Vetri Subramaniam

  • Passive Funds Filing Product Launches · upcoming · High confidence multiple passive funds
    So, we are going to file multiple passive funds with the regulator. And now we have received the board approval. So, some of the funds that we are going to file with SEBI are UTI NIFTY 500 Index Funds, both on the index side and the ETF side, UTI BSE Index Sector Leaders, again, both on index and ETF, UTI NIFTY India New Age Consumption, and UTI NIFTY India Internet Fund. So, these are the four funds with both index and ETF side.

    — Sandeep Samsi

What to watch in Q1 FY27

Standalone Employee Cost Run Rate

Q1 FY27
Current FY26 total Rs 437 crores (incl. Rs 25 cr one-off)
Target Rs 90-95 crores per quarter

Why it matters

To verify if cost rationalization efforts are effective and if employee costs stabilize as per management's guidance.

the run rate on a quarterly basis should be around Rs. 90 crores to Rs. 95 crores for the standalone entity

Risks & concerns

  • International Business Headwinds

    high

    Global investors pulling money out of India ($40 billion outflow) and currency depreciation are significantly impacting the international business, which management described as a 'headwind that we have no way of overcoming right now'.

    Management acknowledged

  • Negative Equity Net Flows

    medium

    Equity net flows were negative on both quarterly and yearly bases, though management noted moderation and diversification efforts.

    Management acknowledged

  • Competition from Fintechs

    medium

    Increased competition in the AMC space from Fintechs and new entrants, requiring continuous focus on distribution and engagement with these platforms.

    Analyst acknowledged

  • Yield Dilution

    low

    Expected 1-2 basis points dilution in overall yield for FY26-27 due to a shift in asset mix towards lower-yielding ETF/Index funds and low-duration fixed income products.

    Management acknowledged

Q&A highlights

8 direct
Employee Expenses and FY27 Run Rate Direct
So, on the employee cost, there is a one-off on account of VRS and family pension. The total quantum of that is close to around Rs. 130 crores that we provision in the Q3 of this particular financial year. Plus, on account of Labour Code, there has been an impact of close to around Rs. 4 crores as well... the run rate on a quarterly basis should be around Rs. 90 crores to Rs. 95 crores for the standalone entity and Rs. 125 crores to Rs. 130 crores on the consolidated firm.

Clarified the one-off costs and provided specific quarterly run rate guidance for employee expenses for the next fiscal year.

Asked by Gaurav Jain

CEO's Strategic Vision and Growth Drivers Direct
the single line agenda is growth... I would say we are operating below our capacity. So, the simple target over the next few years is to grow, is to grow faster than certainly our peers in the Top 10 of the industry... I would say to sort of grow our share of SIPs disproportionately, because I think that is the key to growth, particularly on the active equity side of the business.

Outlined the new CEO's primary strategic focus on accelerating growth, particularly through SIPs and leveraging existing capacity and technology.

Asked by Gaurav Jain

Customer Acquisition during Market Volatility and First-Time SIP Buyers Direct
investors have been consistent in their SIP. While generally, March sees a higher number of SIP closures... overall, there was not a very high amount of redemption pressure that the mutual fund industry saw... we track them on the basis of the PAN numbers that we have... The major scheme that the first-time investors generally look at are the index funds.

Provided insights into investor behavior during volatility, confirmed the resilience of SIPs, and detailed how the company tracks and targets new investors.

Asked by Naman Maheshwari

Impact of SEBI's New TER Norms Direct
the TER on account of exit load has been cut by five basis points. And obviously, there have been some rationalization in the base TER as well. But as a fund house, we are of the view that whatever impact is there, that will be passing on to the intermediaries. So, we don't foresee any challenges as far as this rate cut is concerned on our AMC yield.

Addressed the regulatory change regarding TER and clarified that the impact would be passed on to intermediaries, thus not affecting AMC yield.

Asked by Meghna Luthra

Overall Yield Impact and Product Strategy Direct
So, maybe a basis point or two dilution could be there because ETF and index fund is going at a slightly higher yield... from my point of view, the most critical line to grow is the revenue line. Of course, I would like my higher-yielding products to grow faster. But eventually, from our point of view, there is a cost base that we have. And anything that helps us grow the top line faster, we are happy to take it.

Provided guidance on expected yield dilution for FY27 due to asset mix shift and clarified management's strategic priority on overall revenue growth over managing yield for yield's sake.

Asked by Meghna Luthra

Negative Equity Net Flows and Sales Team Strategy Direct
The only way to avoid the cyclicality which is otherwise inherent in this business is the fact that your flows are pro-cyclical to performance. So, I would like to dial that down by making sure that we have competent silos for each of these different sort of strategies... what we are trying to do through all of the people refresh that I mentioned is essentially correct this... I think we have reached a stage where with 260 odd UFCs as we call it, I think we are pretty much fully staffed to the extent we require.

Addressed concerns about negative equity flows by explaining the strategy of diversifying product offerings and training the sales team, and clarified the rationale behind employee restructuring.

Asked by Mohit Mangal

Outlook for International Business Direct
this is a little bit of a schizophrenic view on India, domestic investors hugely positive... and then you see a completely opposite viewpoint with global investors where they are pulling money out of India... foreigners have pulled out $40 billion out of India... So, our international business honestly is just feeling the pain of that outflow front and center... So, right now, I would say it's just to hold our ground.

Provided a candid assessment of the severe macro headwinds impacting the international business and outlined a defensive strategy.

Asked by Mohit Mangal

Balance Sheet Cash and Shareholder Value Creation Direct
we have that amount of cash on our books also because we are a very old institution... whatever we are generating in terms of profits, we are pretty much paying that out in large measure back to the shareholders by way of dividend. So, we will continue that policy. There is no need to add to that cash pile. But we also believe company of our kind, there is a need to have some investment or rather some liquidity on the books... There could also be opportunities down the road in terms of M&A, etc.

Clarified the company's philosophy on maintaining a large cash balance for strategic flexibility and its commitment to a high dividend payout policy.

Asked by Mahesh A

3 min read 7 chapters

Detailed narrative

Robust AUM Growth and Retail Investor Momentum

UTI AMC demonstrated strong growth in its asset base, with the total group AUM reaching Rs 23.42 lakh crores as of March 31, 2026. The mutual fund AUM specifically increased by 14.45% year-on-year to Rs 3.88 lakh crores. Retail investor participation remained a key driver, with 7.16 lakh new investors (PANs) added in FY26, expanding the total folio base to 1.38 crores. Monthly SIP contributions were robust, hitting Rs 32,087 crores in March 2026, contributing to a total SIP AUM of Rs 15 lakh crores.

Significant Gains from Digital Transformation

The company's strategic investments in digital infrastructure and technology yielded substantial operational efficiencies and revenue growth. Digital business initiatives led to a remarkable 234% increase in revenue and a 33% rise in transactions. Concurrently, these efforts achieved a 31% reduction in cost per transaction. The launch of an AI-powered contact center, VAANI, automated 59% of inbound calls, and an in-app WhatsApp payment facility further enhanced customer experience and service delivery.

CEO's Vision: Accelerating Growth and SIP Focus

CEO Vetri Subramaniam articulated 'growth' as the paramount strategic priority, aiming to leverage the company's existing capacity and technological advancements. A core element of this strategy is to disproportionately grow the SIP book, which is considered vital for sustainable AUM, particularly in active equity. The company is also focused on significantly increasing new customer acquisition through PANs, utilizing digital channels and salesforce automation for cross-selling and upselling opportunities.

Employee Cost Management and Future Outlook

Standalone employee costs for FY26 amounted to Rs 437 crores, which included a Rs 25 crore one-off provision for family pension revision. Excluding this, the normalized standalone employee cost was Rs 412 crores. For FY27, management guided for a quarterly standalone employee cost run rate of Rs 90-95 crores and a consolidated run rate of Rs 125-130 crores, attributing the YoY increase to additional variable pay, quarterly incentives, and strategic recruitment across business lines.

Product Diversification and Yield Strategy

UTI AMC plans to expand its product offerings by filing multiple passive funds, including various NIFTY and BSE index funds, and aims to launch one fund in the SIF (Structured Investment Fund) category during FY27. While a 1-2 basis point dilution in overall yield is anticipated for FY27 due to a shift towards lower-yielding ETF/Index funds, management emphasized that the primary goal is overall revenue growth and product diversification, rather than solely optimizing for yield.

Headwinds in International Business

The international business segment faced significant challenges, primarily due to global investors withdrawing an estimated $40 billion from India during Calendar '25 and Q1 '26, exacerbated by currency depreciation. Management acknowledged these external factors as a major headwind, stating the current focus is on 'holding ground' and diversifying the international AUM through new products like government bond ETFs and attracting institutional clients to alternative offerings.

Capital Allocation and Shareholder Returns

The company maintains a substantial cash and investment balance of Rs 4,000-4,500 crores on its consolidated book, which management views as sufficient for corporate optionality, including potential M&A. UTI AMC declared a final dividend of Rs 40 per share for FY25-26, reflecting a payout ratio of approximately 95% of profits. This aligns with the company's established policy of returning most generated profits to shareholders, indicating no immediate plans to significantly alter its cash reserves.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Financial Services earnings calls