UTIAMC - UTI Asset Management Company Limited Share Price

Management provided a positive outlook for UTI Asset Management Company, focusing on strategic growth, market positioning, and operational efficiency. Key highlights included:

1. Market Capitalization: UTI AMC's market cap surged to over Rs. 18,000 crore, a three-fold increase since its 2020 listing, with AUM growth from Rs. 3.99 lakh crore in 2019 to Rs. 22.42 lakh crore in September 2025.

2. Leadership Transition: Mr. Vetri Subramaniam will assume the role of MD and CEO from February 1, 2026, marking a significant leadership transition planned to ensure continuity and growth.

3. AUM Growth: The UTI Group's total AUM rose 11% year-on-year to Rs. 22.42 lakh crore, with mutual fund AUM at Rs. 3.78 lakh crore, up from Rs. 3.43 lakh crore last year.

4. Retail Participation: The mutual fund folio count reached 1.36 crores, and the retail AUM for equity, hybrid, and solution-oriented schemes stood at Rs. 44.61 lakh crore, indicating robust retail investor engagement.

5. SIP Growth: UTI's SIP inflows hit a monthly contribution record of Rs. 29,361 crores with 9.25 crore active accounts, signifying strong investor confidence.

6. Cost Management: UTI is implementing a Voluntary Retirement Scheme (VRS) expected to impact costs by around Rs. 25 crore, with a focus on optimizing workforce efficiency.

7. Digital Transformation: The company is enhancing its digital capabilities, with 89% of gross sales in Q2 sourced from digital platforms, showcasing its commitment to modernizing operational frameworks.

8. Product Strategy: A continued focus on hybrid funds is emphasized, with efforts targeted at enhancing the distribution network and increasing market share in SIPs.

9. Employee Engagement: Workforce rejuvenation is a priority, with an emphasis on balancing supervisory roles to boost sales effectiveness, aiming for a more agile team.

Management aims to leverage these developments to sustain growth and enhance customer value in the competitive asset management space.

Here are the major questions and detailed answers from the Q&A section of the earnings transcript:

Question 1: "If I look at hybrid category, which is our main target category, last year we had around 19 billion of net inflows... How can we capture more flows in this category?"

Answer: "We are focused on hybrid strategies. The market conditions have impacted inflows, but we are committed to pushing hybrid products, including our multi-asset and aggressive hybrid funds, through both lump sum and SIP modes. Distributor engagement has been strengthened, and we expect improvements in H2 as we enhance our marketing strategies."

Question 2: "Has there been any activity related to the UTI international business given the AUM decline?"

Answer: "The decline was due primarily to two funds affected by redemptions and mark-to-market impacts. We are optimistic as growth-oriented strategies have shown better performance, and with increased sales efforts, we aim to regain inflows as the appetite for Indian investments improves."

Question 3: "Could you explain the math behind the Rs. 25 crores impact related to the VRS scheme?"

Answer: "The Rs. 25 crores is an actuarial impact due to a family pension revision. The exact impact will depend on VRS acceptance, which ends on 31st October. This one-time expenditure is reflected in this quarter's financials due to accounting policies requiring immediate recognition."

Question 4: "What is the estimated cost if all eligible employees accept the VRS?"

Answer: "There are 479 eligible employees. If all opt for VRS, the average payout would be around 60-65 lakhs per employee. We anticipate needing to replace about 70-75 employees, depending on business requirements."

Question 5: "Regarding SIP market share, which was about 2.9%, how do we plan to improve this?"

Answer: "While our share is down slightly, we've seen growth in SIP numbers, registering 11% YoY. Our emphasis on enhancing digital engagement and partnerships with distributors has been fruitful, especially in smaller cities, and we remain committed to increasing our SIP market presence."

Question 6: "What is the expected normalized employee cost after the VRS?"

Answer: "Post-VRS, normalized employee costs will be assessed once all options are in. We will provide an accurate figure in our Q3 results. Current costs are projected to align within the typical 2.5%-3% guidance as we evaluate workforce requirements."

Question 7: "What are the new pension schemes mentioned and their market opportunity?"

Answer: "We plan to launch two NPS equity schemes and a dynamic asset allocation scheme. These adjustments align with new regulations, allowing more flexible product designs to stimulate the private NPS market, which still has ample growth potential."

This summary encapsulates the major queries raised during the Q&A and the respective detailed answers.