ICICI Prudential AMC Stock Gets ‘Buy’ Call From Equirus; 34% Upside Seen Post Listing
- iamramdharsan
- 3 days ago
- 2 min read
ICICI Prudential Asset Management Company (AMC) shares are in focus after Equirus Securities initiated coverage with a bullish ‘Buy’ (Long) rating, assigning a target price of ₹2,900, which implies a potential upside of nearly 34% from the issue price.
The brokerage’s positive outlook came just ahead of the company’s stock market debut, following one of the most successful IPOs of 2025.
Strong Listing After Heavily Subscribed IPO
ICICI Prudential AMC shares made a strong debut on Dalal Street, listing at ₹2,600, representing a 20% premium over the IPO issue price of ₹2,165.The three-day public issue witnessed overwhelming demand, garnering bids worth ₹3 lakh crore, making it the second-most subscribed IPO of 2025.
As of the latest trade, the stock is hovering around ₹2,617, up 21% from the issue price.
Mutual Fund Industry Growth Supports Long-Term Outlook
Equirus highlighted the robust structural growth of India’s mutual fund industry as a key investment driver. Over the past five years:
Industry revenue has grown at a 16% CAGR
EBITDA has expanded at 19% CAGR
Profit after tax (PAT) has surged at 23% CAGR
Industry-wide PAT crossed ₹15,000 crore in FY25, reflecting improving profitability and scale benefits across asset management companies.
ICICI Prudential AMC: Industry Profit Leader
ICICI Prudential AMC stands out as the most profitable AMC in India, commanding a 17.4% share of industry PAT in FY25, according to Equirus.
From a business mix perspective, the company is India’s largest equity-focused AMC, with a 13.4% market share in equity assets under management. This leadership is supported by:
Consistently strong scheme performance
A nationwide sales force of over 2,900 professionals
Deep penetration across retail and high-net-worth investor segments
Equity AMC assets have grown at a 27% CAGR since FY15, helping the company maintain a high-yielding product mix and strengthen its competitive moat.
Non-MF Businesses Add Profitability Boost
Beyond mutual funds, ICICI Prudential AMC has rapidly expanded its non-MF businesses, which now contribute nearly 15% of total revenues. These segments generate yields exceeding 120 basis points, enhancing blended margins and earnings stability.
The company operates an asset-light business model, translating into industry-leading profitability metrics:
EBITDA margins above 70%
PAT margins exceeding 50%
Return on equity (RoE) in the range of 70–80%
Earnings Growth and Valuation Comfort
Equirus expects ICICI Prudential AMC’s revenue and PAT to grow at a 16% CAGR between FY25 and FY28, driven by strong inflows into mutual funds and alternate asset management businesses.
At the upper end of its IPO price band, the stock trades at around 30x FY27 estimated earnings per share (EPS). This represents a 10–15% valuation discount compared to peer HDFC AMC, making the stock attractive on a relative basis, according to the brokerage.
Other Brokerages Also Turn Positive
Earlier this week, PL Capital (Prabhudas Lilladher Group) also initiated coverage on ICICI Prudential AMC with a ‘Buy’ rating and a target price of ₹3,000, indicating an upside potential of up to 40% from the issue price.
PL Capital cited the company’s dominant market position, strong fundamentals, and scalable business model as key reasons for its bullish stance.
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