HDFC AMC delivered a robust financial performance in Q3FY26, with operating revenue growing 15% year-on-year and 5% quarter-on-quarter to ₹10.80 billion, meeting analyst expectations. The asset management company demonstrated strong operational efficiency while maintaining healthy profitability margins during the quarter.

Quarterly Financial Performance

The company's financial metrics for Q3FY26 showed consistent growth across key parameters:

Yields came in at 46.50 basis points in Q3FY26 compared to 47.50 basis points in Q3FY25 and 46.60 basis points in Q2FY26, showing relatively stable performance.

Expense Management and Profitability

HDFC AMC's expense management showed mixed trends during the quarter. Employee costs increased significantly to ₹1.20 billion, up 30% year-on-year, though remaining flat quarter-on-quarter. Other expenses decreased to ₹730 million, down 2% year-on-year and 28% quarter-on-quarter, demonstrating effective cost control measures.

The company maintained strong profitability with an EBITDA margin of 81.5%, compared to 81.7% in Q3FY25 and 77.9% in Q2FY26, reflecting operational efficiency despite increased employee costs.

Nine-Month Performance Highlights

For the nine-month period FY26, HDFC AMC demonstrated accelerated growth momentum:

The nine-month performance indicates stronger growth compared to the quarterly figures, suggesting positive business momentum.

Analyst Outlook and Recommendations

Motilal Oswal has maintained its earnings estimates for FY26, FY27, and FY28, expressing confidence in the company's growth trajectory. The brokerage expects a 16% compound annual growth rate (CAGR) each in revenue, EBITDA, and profit after tax (PAT) over the FY25-28E period. Additionally, they project an 18% AUM CAGR during the same timeframe.

The research firm has reiterated its BUY rating on HDFC AMC stock with a target price of ₹3,200, based on 42x FY28E core earnings per share. This target reflects confidence in the company's ability to sustain growth and maintain its market position in the asset management industry.

Citigroup has maintained its neutral rating on HDFC AMC , setting a target price of ₹2,875 per share for the asset management company.

Analyst Recommendation

The global brokerage firm's neutral stance on HDFC Asset Management Company indicates a balanced assessment of the stock's current valuation and market prospects. The target price of ₹2,875 provides investors with a benchmark for evaluating the stock's potential performance.

Market Implications

Citi's neutral recommendation suggests that analysts view HDFC AMC as fairly valued at current market levels. This rating typically indicates that the brokerage sees limited upside or downside potential in the near term, with the stock expected to trade in line with broader market movements.

The target price of ₹2,875 serves as a reference point for investors considering positions in the asset management sector, particularly in one of India's leading fund houses.