Buy UTI AMC; target of Rs 1650: Motilal Oswal

Motilal Oswal's research report on UTI AMC

UTI AMC’s 1QFY26 operating revenue stood at INR3.8b (in line), up 13% YoY/6% QoQ. Yield on management fees stood at 42bp in 1QFY26 vs. 43.4bp in 1QFY25 and 42.4bp in 4QFY25. Total opex was up 16% YoY to INR2.1b. As bp of QAAUM, it remained flat YoY at 22.9bp in 1Q (vs. 24.3bp in 4QFY25). EBITDA was up 9% YoY/12% QoQ at INR1.7b (8% miss on account of higher employee costs). EBITDA margins stood at 45.4% vs. 47.1% in 1QFY25 and 42.6% in 4QFY25. PAT declined 8% YoY to INR2.5b (15% beat), driven by better-than-expected other income. Higher employee costs were offset by other income. FY26/FY27 earnings estimates remain broadly unchanged. We expect UTI to report a CAGR of 15%/12%/15% in AUM/revenue/core PAT over FY25-27E. The stock trades at FY27E P/E of 18x and core P/E of 28x. We reiterate our BUY rating with a one-year TP of INR1,650 (based on 32x core FY27E EPS).

Outlook

We expect UTI to report a CAGR of 15%/12%/15% in AUM/revenue/core PAT over FY25-27E. The stock trades at FY27E P/E of 18x and core P/E of 28x. We reiterate our BUY rating with a one-year TP of INR1,650 (based on 32x core FY27E EPS).

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

UTI AMC_25072025_Motilal Oswal