HDFC AMC tumbles after Q4 PAT slides 10% to 250 cr

HDFC Asset Management Company fell 3.33% to Rs 2535 after net profit fell 9.5% to Rs 249.83 crore on a 17.9% fall in total income to Rs 449.62 crore in Q4 March 2020 over Q4 March 2019.

Profit before tax (PBT) declined 20.5% on a year-on-year (YoY) basis to Rs 329.57 crore in the fourth quarter of the financial year 2020. Total expenditure was down by 9.8% to Rs 120.05 crore and total tax expenses contracted 42.4% to Rs 79.74 crore in Q4 FY20 over Q4 FY19.

The quarter average assets under management (QAAUM) of Rs 3,698 billion as of 31 March 2020 compared to Rs 3,423 billion as on 31 March 2019, growth of 8%. It has 13.7% market share in QAAUM of the mutual fund industry.

QAAUM in actively managed equity oriented funds i.e. equity oriented QAAUM excluding index funds stood at Rs 1,574 billion as on 31 March 2020 with a market share of 15.2%. The AMC is the largest actively managed equity-oriented mutual fund manager in the country. The ratio of equity oriented AUM and non-equity oriented AUM is 38:62 compared to the industry ratio of 37:63.

As of 31 March 2020, 57% of the company's total monthly average AUM is contributed by individual investors compared to 52% for the industry. It had a market share of 15% of the individual monthly average AUM in the industry.

HDFC AMC's net profit jumped 35.7% to Rs 1262.41 crore on a 2.2% rise in total income to Rs 2143.43 crore for the full year ended on 31 March 2020 (FY20) as compared to the full year ended on 31 March 2019 (FY19). PBT stood at Rs 1653.05 crore in FY20, up by 20.2% from Rs 1374.70 crore in FY19.

Commenting on the impact of COVID-19 pandemic on its business, HDFC AMC said that it has assessed the impact of the pandemic on its operations and its assets including the value of its investments and trade receivables as at March 31, 2020. The management does not, at this juncture, believe that the impact on the value of the Company's assets is likely to be material.

However, since the revenue of the company is ultimately dependent on the value of the assets it manages, changes in market conditions and the trend of flows into mutual funds may have an impact on the operations of the company. Since the situation is rapidly evolving, its effect on the operations of the company may be different from that estimated as at the date of approval of these financial results.

The company will continue to closely monitor material changes in markets and future economic conditions, the asset management firm said.

HDFC Asset Management Company (AMC) is investment manager to HDFC Mutual Fund. The company has a diversified asset class mix across equity and fixed income/others. It also has a countrywide network of branches along with a diversified distribution network comprising banks, independent financial advisors and national distributors.

Powered by Capital Market - Live News