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Capital Market players, including asset management companies (AMCs) and RTAs, are likely to report a steady performance during 2QFY27. SIP flows were resilient at Rs323bn in Aug-26, while the Nifty 500 declined ~4% over 2QFY27. Against this backdrop, mutual fund (MF) AUM is expected to grow ~5%, led by healthy flows in the quarter. However, the impact of MTM losses is likely to spill over to 3Q and weigh on AUM growth. During 2QFY27, AUM growth for AMCs is expected to be steady, in the ~2-5% range on a sequential basis, while yields are expected to be broadly stable. However, the negative movement in Nifty 500 due to increased volatility in markets is expected to weigh on the investment income, thereby impacting profitability. While NAM is likely to remain the fastest-growing AMC on a sequential basis, HDFCAMC, ICICIAMC, SBIAMC, and ABSLAMC are expected to log ~3-4% sequential growth in AUM while UTIAMC is likely to post a relatively modest AUM growth. Supported by healthy sequential industry AUM growth, RTAs are likely to report healthy MFbased revenue while non-MF businesses are likely to sustain steady revenue growth. We tweak our estimates across our coverage, factoring in the recent market movements, and roll-forward our TPs to Sep-27. Despite volatile market conditions, we maintain a constructive view on the long-term structural growth prospects of the industry. Any near-term correction in stock prices should offer attractive accumulation opportunities.

AMCs to report steady operating performance;

MTM movements impact PAT Despite the volatile markets, sustained SIP flows at Rs323bn during Aug-26 and steady net inflows across AMCs are expected to drive healthy AUM growth for the industry on a sequential basis. While the Nifty 500 declined ~4% over 2QFY27, impact of the negative movement in equity markets is expected to spill over to 3QFY27. In this context, the MF QAAUM across AMCs under our coverage is likely to grow in the ~2-5% range on a sequential basis; NAM is likely to maintain its position as the fastest-growing AMC among top players, clocking ~5% MF QAAUM growth driven by strong growth in the Equity AUM. ICICIAMC, HDFCAMC, and SBIAMC are likely to post ~4% MF QAAUM growth on a sequential basis, while ABSLAMC would clock in ~3% MF QAAUM growth on a sequential basis. UTIAMC is likely to witness ~2% MF QAAUM growth on a sequential basis. Revenue yields are likely to be largely stable, with revenue growth mainly tracking AUM growth. EBITDA margin is likely to be largely stable, while negative impact of the movement in equity markets and the rise in yields are expected to impact investment income during the quarter, thus leading to lower profitability.

Steady revenue growth for RTAs supported by non-MF businesses

Driven by a healthy ~5% MF QAAUM growth for the industry and largely stable yields, RTAs are likely to witness healthy MF-based revenue growth during 2QFY27. Further, the performance of non-MF businesses of both CAMS and KFINTECH is expected to remain healthy, supporting overall revenue growth. While CAMS is likely to see impact of employee hikes during the quarter, it would report a slight dip in EBITDA margin to 44.5%. KFINTECH is expected to witness EBITDA margin expansion during the quarter, led by healthy revenue growth and cost control.

We maintain a positive view on the long-term prospects of AMCs and RTAs

We tweak our FY27-29 estimates across RTAs and AMCs, factoring in the recent decline in equity markets and its flow-through impact on AUM growth. Accordingly, we roll forward our target price to Sep-27E and cut it across AMCs and RTAs. While near-term market volatility is expected to impact the businesses of AMCs and RTAs, we remain positive on the overall long-term structural growth prospects of the MF industry, led by resilient retail SIP behavior and under-penetration in the mutual fund industry. Any nearterm correction in stock prices would offer attractive entry points in the long term.

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