Motilal Oswal Recommends Buy in ICICI Prudential AMC, Targets Rs 3500 per Share

ICICI Prudential AMC Research Report

Company Overview ICICI Prudential AMC (IPRUAMC) is India's second-largest asset management company, with a 13.5% market share and INR9.1 trillion in quarterly average assets under management (QAAUM) as of December 2025. The company was founded in 1998 and is jointly promoted by ICICI Bank (53% stake) and Prudential Corporation Holdings (35% stake).

Market Positioning As the largest AMC by active QAAUM, IPRUAMC is well-positioned to benefit from the expected growth in the mutual fund (MF) industry, which is projected to expand at a 17% compound annual growth rate (CAGR) over FY26-28E. This growth is driven by rising financialization and improving retail participation.

Performance Metrics The company has delivered sustained fund outperformance, with over 80% of its assets under management (AUM) in the top two quartiles on a one-year basis since April 2025, and more than 50% in the top two quartiles on a three-year basis since December 2023. Yields remain among the best-in-class, with equity/debt yields at 67bp/32bp (3QFY26).

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Outlook We expect EBITDA margins to sustain above 70% and core profit after tax (PAT) to expand at a 16% CAGR over FY26-28. We initiate coverage with a BUY rating and a one-year target price of INR3,500, based on a 42x FY28E core price-to-earnings (P/E) multiple.