HDFC Asset Management Co (HDFC AMC) is the asset management arm of the HDFC Ltd (Promoter) and was established in 1999. In 2001, Standard Life Investments acquired 26% stake in HDFC AMC. It is the most profitable AMC and the second largest in terms of asset under management (AUM) with ~14% market share. As on March 2018, it managed AUM of `2,91,985cr out of which 51% was equity AUM. It has grown its AUM at a CAGR of 25.5% over FY2013-18.

Outlook & Valuation: At the upper end of the IPO price band, it is offered at 32x its FY2018 EPS and 11x its FY2018 book value, demanding `23,318cr market cap, which is 7.6% of the MF AUM (`3,06,841cr for the month of June 2018). Considering that HDFC AMC is the second largest AMC coupled with huge
potential of MF industry growth, strong return ratios, asset light business, higher
dividend payout ratio and track record of superior investment performance, we are positive on this IPO and rate it as SUBSCRIBE.

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