Jatin Malhotra 31 October 2026

Nippon Life India Asset Management Share Price Target at Rs 1,300 Emkay Global Research Report

Emkay Global Financial Services has reiterated its BUY call on Nippon Life India Asset Management with an unchanged September 2027 target of Rs 1,300, about 33% above the current price of Rs 976. In the September quarter, average mutual fund assets rose about 5% sequentially to Rs 7.87 lakh crore, the fastest pace among the top 10 fund houses. Revenue grew 4% to Rs 795.8 crore, slightly short of the brokerage's estimate, as yields slipped. EBITDA margin widened to 67.5%. Net profit fell 36% to Rs 324.4 crore after a one-time Rs 97 crore SEBI settlement and lower other income. Emkay values the stock on a DCF basis, at about 40 times FY28 earnings.

Rating

BUY

Reiterated

Price

Rs 976

Oct. 23, 2026

Target

Rs 1,300

September 2027

Upside

33.2%

12-month view

Emkay Research · Q2 FY27 Result Update · Asset Management

Nippon Life India AMC keeps its stride as it spends for the long haul

The fund house grew assets faster than any large rival and widened its operating margin. A one-off regulatory settlement dented reported profit, but Emkay sees no reason to change its Rs 1,300 target.

The call in brief

Emkay Research maintained its BUY rating on Nippon Life India Asset Management (NAM) in an Oct. 23 note and held its September 2027 target at Rs 1,300, which implies about 40 times FY28 estimated earnings. The brokerage last lowered its target on Oct. 8, from Rs 1,350 to Rs 1,300, and has rated the stock a buy throughout 2026.

The stock has lost about 16% in the past month and trades well below its 52-week high of Rs 1,270. Emkay argues that the company's strong brand, retail franchise and steady inflows leave it well placed to keep growing assets.

The quarter in one bento box

Average MF assets

Rs 7.87 lakh crore

+20% YoY · +5% QoQ, market share steady at 9.0%

EBITDA margin

67.5%

Up 130 bps QoQ; estimate 66.1%

Revenue

Rs 795.8 crore

+21% YoY; 1% below estimate

EBITDA

Rs 537.5 crore

+25% YoY · +6% QoQ

Core PAT

Rs 377.5 crore

+19% YoY; +1% QoQ

Reported PAT

Rs 324.4 crore

-36% QoQ and -6% YoY, against an estimate of Rs 416.5 crore, because of the SEBI settlement and thin other income

Revenue yield

40.1 bps

From 40.9 bps in Q1

Where the numbers came from

Yield slipped, costs held flat. Management blamed the lower yield on telescopic pricing. Under that system, fees per rupee fall as a scheme grows, and NAM's equity book has grown faster than almost any other in the industry. Employee costs stayed at Rs 138.8 crore and other expenses eased 2%, so EBITDA beat Emkay's Rs 529 crore estimate even though revenue fell short.

The profit gap was not an operating problem. Other income fell to Rs 23.1 crore from Rs 170.2 crore in the June quarter. NAM also booked a Rs 97 crore exceptional charge: Rs 89 crore of management fees reversed, including interest, plus Rs 7.7 crore in regulatory costs. It has paid the full amount to SEBI and is waiting to hear further from the regulator.

Asset mix, share of average AUM (%)

Segment	Q2 FY26	Q1 FY27	Q2 FY27	QoQ (ppt)
Equity	50.0	48.9	49.9	+1.0
Debt	15.5	12.4	11.8	-0.6
Liquid	6.6	6.3	6.7	+0.4
Other (incl. ETFs)	27.9	32.4	31.6	-0.8

Five takeaways from the earnings call

Reach

Largest investor base in the industry, at 2.43 crore unique investors. More than one in three fund investors used NAM in the quarter, and folios crossed 4 crore.

Flows

Net flows were similar in Q1 and Q2. NAM's share of net flows ran in the high single digits, reaching about 10%, as money went to diversified and hybrid funds.

SIP cushion

A monthly SIP book of about Rs 3,200 crore, drawn largely from smaller towns outside the top 30 cities, protects net flows if the market correction deepens.

No NFOs

NAM gained a smaller share of new investors because it chose not to launch new fund offers, which attract buyers with a Rs 10 NAV but have no track record.

Costs

Cost growth guidance stays at 18% to 20%. Mutual fund costs should be almost flat, while senior AIF hires lift the subsidiary's costs over the next three to six quarters.

Estimates nudged up beyond FY27

Emkay raised revenue estimates by 1% to 4% and EBITDA estimates by 3% to 7% for FY27 through FY29. It cut its FY27 profit forecast by about 4% because of the settlement, and raised its FY28 and FY29 profit forecasts by 4% to 5%. Its "adjusted" profit figure keeps the one-time charge in. The brokerage expects average assets to grow at a 19% annual rate to Rs 11.45 lakh crore by FY29. It also expects revenue yield to keep easing, to 37.7 bps.

Rs crore (Y/E March)	FY26	FY27E	FY28E	FY29E
Revenue	2,708.7	3,211.4	3,756.5	4,314.2
EBITDA	1,794.9	2,121.8	2,475.1	2,869.6
Adjusted PAT	1,529.4	1,707.3	2,089.4	2,407.8
EPS (Rs)	23.6	26.4	32.3	37.2
RoE (%)	34.5	36.1	42.2	45.4
P/E (x)	40.6	36.5	29.8	25.9

How Emkay builds the Rs 1,300 target

Sep-27 target price

Rs 1,300

Mar-27 fair value Rs 79,418 crore ÷ 63.81 crore shares = Rs 1,245 a share, rolled forward six months

Discounted cash flows

Rs 41,711 crore

Terminal value

Rs 37,707 crore

Cost of equity 12% · terminal growth 5%

At the target, the stock would trade at 39.7 times FY28 earnings, 16.2 times FY28 book value and about 9% of FY28 assets. At today's price, the same multiples are 29.8 times, 12.2 times and 6%. The company is debt-free, with estimated FY27 net cash of Rs 4,312 crore, and pays out about 90% of profit as dividends.

What could go wrong

Yields keep sliding

Telescopic pricing could squeeze fees faster than the modelled 37.7 bps by FY29 as equity schemes grow.

Market cycles

A deeper correction would hit assets and other income. Direct and HNI investors have already shifted some money to SIFs, alternatives and bonds.

Costs and regulators

Cost growth of 18% to 20% and AIF hiring could outrun revenue. NAM is also still waiting to hear more from SEBI about the settlement.

Editor's note

Size of the SIP book. The earnings-call notes describe a monthly SIP book of about Rs 3,200 crore. Emkay's own SIP chart (Exhibit 7), however, shows monthly SIP flows of about Rs 3,700 crore for the last few quarters. The report does not explain the gap, so this article uses management's figure in the takeaways.

Share of net flows. The summary says NAM's share of net flows was in the "high single-digit," while the call notes say it touched "~10%." We present this as a range.

Share count (basis, not an error). The report uses three share counts: 64 crore on the cover, 63.81 crore in the DCF and 64.7 crore in the financial model. That is why FY28 EPS shows as both Rs 32.3 and Rs 32.7. Emkay prints no risk list, so TopNews drew the risks above from its commentary.

Sources

Emkay Global Financial Services, Nippon Life India Asset Management Q2 FY27 Result Update, "Stable quarter; investing for the long term," Oct. 23, 2026. Analysts: Avinash Singh, Mahek Shah, Harsh Saxena. Company filings as cited by Emkay. The bento scorecard, DCF gate and asset-mix table restate Emkay's own figures. Rupee figures have been converted from millions and billions to crore and lakh crore.

Disclaimer: Investments in the securities market are subject to market risks. Read all related documents carefully before investing. This TopNews story is for information only and does not constitute investment advice. Readers should consult a registered financial adviser before making investment decisions.

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