Earnings Outlook
MTM losses, weak mkt share to pull down UTI AMC Q4 PAT 20% YoY
This story was originally published at 10:50 IST on 20 April 2026
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By Cassandra Carvalho
MUMBAI – UTI Asset Management Co. Ltd.'s net profit for the quarter ended March is expected to decline due to fall in market share and low treasury income, according to brokerages tracking the company. Higher costs are also expected to eat into its profitability, brokerages said.
The asset management company is expected to post a net profit of INR 991.63 million for the quarter, down 20% on year, according to the average of estimates from eight brokerages. Sequentially, the company's net profit is likely to fall 57%. The asset manager will detail its financial results for the quarter and year ended March on Thursday.
The lowest estimate for net profit is INR 490 million by Kotak Securities Ltd. and the highest is INR 1.30 billion, estimated by both Elara Securities (India) Pvt. Ltd. and Nuvama Wealth Management Ltd. The company is expected to report net sales of INR 3.77 billion for the March quarter, up almost 19% on year but down 11% on quarter, according to the average of the estimates. The highest estimate for net sales is INR 3.88 billion from Motilal Oswal Financial Services Ltd., while the lowest estimate is INR 3.40 billion from Kotak Securities.
The asset manager looks after the investments of UTI Mutual Fund, whose quarterly average assets under management were INR 3.93 trillion as on Dec. 31. Equirus Securities expects this figure to fall 1.4% in the March quarter. Motilal Oswal expects the figure to "remain flat, with declines in equity and debt AUM (to be) offset by growth in passives (funds)."
As per latest data from the Association of Mutual Funds in India, the mutual fund industry saw a net outflow of INR 2.40 trillion in March, after net inflows of INR 1.56 trillion and INR 945.30 billion in January and February, respectively. UTI AMC likely lost market share, especially in equity funds, due to low net inflows, brokerages said.
Mark-to-market losses on the asset manager's investment book are likely to result in a sharp decline in its net profit, according to brokerages. In the March quarter, the Nifty 50 fell nearly 15%, while the 10-year benchmark government bond yield rose 45 basis points. Nuvama Wealth Management estimates a 69?ll quarter on quarter in the asset manager's other income due to weak equity mark-to-market valuations. Some brokerages said higher costs could also weigh on the asset manager's bottom line. Prabhudas Lilladher expects operating yields to rise nearly 10 bps on quarter.
In the December quarter, the company had reported a net profit of INR 1.24 billion, down over 13% on year and nearly 26% on quarter. The fall in profit was exacerbated by higher employee costs linked to voluntary retirement scheme. Due to the one-time cost in Oct-Dec, Equirus Securities expects lower employee costs sequentially, while Kotak Securities said the sequential growth in core profit before tax would be "less relevant". The company had reported a total income of INR 4.24 billion, up 28% on year and 8% on quarter.
Brokerages will track the management's comments on new initiatives, performance of schemes, market share, cost control and plans to address the impact of the voluntary retirement scheme. Outlook on flows and growth in assets and addressing regulation on total expense ratios will also be in focus.
Of the eight brokerage reports on the company available with Informist, seven have a 'buy' recommendation on the stock for an average target price of INR 1,271.43. One brokerage has a 'hold' recommendation. JM Financial Institutional Securities said UTI AMC was the "top stock to avoid" in the asset and wealth management segment.
The company's share price has risen just 0.5% since it announced the December quarter results on Jan. 21. At 1033 IST, shares of the company were at INR 1,038.60 on the National Stock Exchange, up 0.4% from Friday.
Following are the March quarter earnings estimates, in INR million, from eight brokerages for UTI Asset Management Co., in descending order of the estimate of net profit:
|
Brokerage |
Net Sales |
Net profit |
| Elara Securities (India) Pvt. Ltd. | 3,800.00 | 1,300.00 |
| Nuvama Wealth Management Ltd. | 3,800.00 | 1,300.00 |
| Prabhudas Lilladher Pvt Ltd. | 3,837.00 | 1,230.00 |
| Motilal Oswal Financial Services Ltd. | 3,876.00 | 1,150.00 |
| Equirus Securities Pvt. Ltd. | 3,824.00 | 1,011.00 |
| YES Securities (India) Ltd. | 3,736.00 | 755.00 |
| JM Financial Institutional Securities Pvt. Ltd. | 3,852.00 | 697.00 |
| Kotak Securities Ltd. | 3,397.00 | 490.00 |
|
Average |
3,765.25 |
991.63 |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Ashish Shirke
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