AMC stocks have seen sell offs and valuation downgrades. But inflows remain strong.
The industry AUM declined 10.1 per cent M-o-M (up 12.2 per cent year-on-year or Y-o-Y) to ₹73.7 trillion in March 2026, due to mark-to-market (MTM) losses as the market trended down and there were outflows in debt and liquid funds at the end of FY26.
But net equity and hybrid (ex-arbitrage) inflows rose 20 per cent M-o-M to ₹45,030 crore, well above the ₹38,000 crore 11-month average.
Equity inflows were ₹40,450 crore, up 56 per cent M-o-M, while hybrid inflows declined to ₹4,580 crore, down 60 per cent M-o-M.
Passive flows were ₹30,770 crore, up 122 per cent. For FY26, equity and hybrid (ex-arbitrage) declined 7 per cent to ₹4.51 trillion from a high base and passive flow was up 51 per cent to ₹2.1 trillion.
Systematic investment plan (SIP) flows were ₹32,090 crore, up 23.8 per cent Y-o-Y. SIP inflows are driven by retail participation and it’s a sign of market maturity that inflows have been robust despite corrections. The number of contributing SIP accounts hit 97.2 million.
Passive inflows rose to ₹30,770 crore, up 122 per cent M-o-M, driven by exchange traded funds (ETFs) and index funds.
But debt and liquid funds (where corporate treasuries have high exposures) saw outflows of ₹2.95 trillion, due to tax-related redemptions and rising yields.
The new specialised investment funds (SIFs) recorded inflows of ₹1,310 crore in March, with AUM up 9.4 per cent M-o-M to ₹10,620 crore.
If the strong momentum flow continues, AMCs could deliver high-teens average AUM growth and mid-high teens revenue and net profit annual growth over FY26-28.
The market correction will impact Q4FY26 equity AUM growth and profitability for AMCs but long-term profitability should continue to be good.
Consensus expects aggregated revenue for AMCs to grow by high teens Y-o-Y and flat Q-o-Q growth in Q4FY26 but sharp declines in other income will drag down profitability. Core operating profit may grow by mid 20s (per cent) Y-o-Y but net profit could decline due to MTM losses.
Among AMCs, ICICI AMC (likely revenue growth of 23 per cent Y-o-Y), Nippon Life India Asset Management (28 per cent) and HDFC AMC (20 per cent) could lead, given the good inflows and stable yields.
Adiya Birla Sun Life AMC (ABSL AMC) (13 per cent Y-o-Y growth) and UTI AMC (9 per cent Y-o-Y) may see moderate growth.
As such, analysts are downgrading estimates and cutting target valuations for AMC stocks. This could lead to a shakeout in terms of market leaders getting better valuations.
ICICI AMC should see mid 20s revenue growth Y-o-Y in Q4FY26.
Core operating profit could grow by 28 per cent Y-o-Y or more. But net profit may decline or grow by low-single digits with other income declining sharply.
HDFC AMC may report early 20s (per cent) Y-o-Y of revenue growth with 20 per cent Y-o-Y growth in total AUM. Yield should be stable at 46-47 basis points. Core operating profit may grow by early twenties Y-o-Y while net profit is likely to decline Q-o-Q and grow by single digits Y-o-Y, due to a sharp decline in other income.
NAM should score late twenties Y-o-Y revenue growth, with AUM growth at 30 per cent Y-o-Y. Core operating profit may grow at over 35 per cent Y-o-Y but net profit is likely to decline Q-o-Q while growing by low teens (in per cent) Y-o-Y. Again a sharp decline in other income is expected.
ABSL AMC's revenue is expected to increase by low teens Y-o-Y, with core operating profit growth of mid-teens Y-o-Y. Net profit is likely to decline steeply due to a sharp drop in other income. AUM growth is in mid-teens.
UTI AM may report single-digit Y-o-Y revenue growth, with core operating profit up by high teens. Net profit is expected to decline sharply due to treasury losses.
Over the medium term, the narrative remains positive. Trends like growing retail participation should continue to drive AMC growth. The key risk would be a long period of bearish market performance that leads to sentiment reversal.
 "mutual fund")