HDFC AMC gains 5% after SBI MF bought over 2% stake via open market

Shares of HDFC Asset Management Company (AMC) surged 5 per cent to Rs 1,761.50 in Tuesday’s intra-day trade, after SBI Mutual Fund (MF) acquired more than 2 per cent stake in the company via open market.

On Monday, March 20, 2023, SBI MF bought 4.73 million shares representing 2.2 per cent stake in the AMC via open market transactions that amounted to Rs 757.4 crore. SBI MF purchased shares at price of Rs 1,600 per share on the NSE, the bulk deal data shows.

However, GQG Partners Emerging Markets Equity Fund sold 2.48 million shares in HDFC AMC worth Rs 396.83 crore. The foreign portfolio investors held 4.86 million shares, representing 2.28 per cent stake in the company, at the end of December 2022 quarter, the shareholding pattern data shows.

At 11:25 am; HDFC AMC traded 4 per cent higher at Rs 1,746, as compared to 0.43 per cent rise in the Nifty 50 index. A combined 1.4 million shares changed hands on the NSE and BSE.

Meanwhile, on Monday, the stock had hit over three-year low of Rs 1,589.50 on the NSE. It touched its lowest level since May 2019. In the past three months, the stock underperformed market as shares fell 22 per cent, as against 5 per cent decline in the S&P BSE Sensex.

HDFC AMC is a leading AMC in India, with assets under management (AUM-closing) of Rs 4.48 trillion as on December 31, 2022.

Though HDFC AMC’s financial growth is muted, analysts at Geojit Financial Services believe that continuous focus on equity-oriented funds, new product launches, capturing new market share and steady yields are expected to enhance its performance in the near future.

"HDFC AMC has a healthy pipeline of new product launches and steady SIP momentum to support AUM growth. However, expansion of AUM and gaining additional market share across all segments are expected to boost overall growth in the near term. The management expects volumes to more than compensate for loss in margins. Green ticks were also seen in terms of onboarding of new customers, improved digital assets and user experience," the brokerage firm said.