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Motilal Oswal's research report on Nippon Life India AMC

Nippon Life India AMC (NAM)’s operating revenue grew 21% YoY to INR5.7b (in line) in 4QFY25. Yields declined to 40.7bp from 41.3bp in 4QFY24. NAM’s FY25 revenue came in at INR22.3b, recording a growth of 36% YoY. Total opex grew 13% YoY to INR2b (in line) in 4QFY25. As a result, EBITDA rose 26% YoY to INR3.7b (in line) for the quarter. This led to an improvement in EBITDA margin to 64.5% from 62.1% in 4QFY24. PAT stood at INR3b in 4QFY25 (10% beat; -13% YoY), largely due to tax reversal and higher-than-expected other income. For FY25, the company’s PAT grew 16% YoY to INR12.9b. Equity yield stood at 57bp, and management continues to expect a 2-3bp dip YoY going forward. In FY26, the company expects a cost increase of 15% ex-ESOP, with employee cost growth at 14-15% as well. The tax rate should remain in the range of 24-25%.

Outlook

We broadly retain our earnings estimates, keeping our AUM assumptions intact and accounting for expense growth according to the management guidance. We reiterate our BUY rating on the stock with a TP of INR 750, based on 34x FY27E core EPS.

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Nippon Life India AMC - 29042025 - moti

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