Aditya Birla Sun Life AMC Limited, started in 1994, and established a geographically diversified pan-India distribution presence covering 284 locations spread over 27 states and six union territories. The distribution network is extensive and multi-channeled with a significant physical as well as digital presence, and included over 66,000 KYD-compliant MFDs, over 240 national distributors and over 100 banks/financial intermediaries, as of June 30, 2021. ABSL AMC Limited is a joint venture between ABCL and Sun Life AMC. ABCL is the listed non-operating holding company of the financial services businesses of the Aditya Birla group, a Fortune 500 global conglomerate. ABSL AMC Limited is ranked as the largest non-bank affiliated AMC in India by QAAUM since March 31, 2018, and among the four largest AMCs in India by QAAUM since September 30, 2011, according to the CRISIL Report. They managed total AUM of Rs 2,936.42 billion under the suite of mutual fund (excluding our domestic FoFs), portfolio management services, offshore and real estate offerings, as of June 30, 2021. Company managed 118 schemes comprising 37 equity schemes (including, among others, diversified, tax saving, hybrid and sector schemes), 68 debt schemes (including, among others, ultra short-duration, short-duration and fixed-maturity schemes), two liquid schemes, five ETFs and six domestic FoFs, as of June 30, 2021. The flagship schemes include Aditya Birla Sun Life Frontline Equity Fund and Aditya Birla Sun Life Corporate Bond Fund, both of which have grown to become leading funds in India under their management. The total QAAUM (excluding the domestic FoFs) has grown over the years and was Rs 2,754.54 billion, Rs 2,692.78 billion, Rs 2,475.22 billion and Rs 2,464.80 billion as of June 30, 2021 and March 31, 2021, 2020 and 2019, respectively. In addition, they provide portfolio management services, offshore and real estate offerings and they managed total AUM of Rs 115.15 billion as part of such services, as of June 30, 2021. They cater to a wide range of customers from individuals to institutions through this pan-India network and offering of customer solutions, which positions them well to attract a large segment of the Indian mutual fund market across varying customer requirements and risk profiles and to develop a broad customer franchise with a strong retail customer base. The MAAUM from institutional investors was Rs 1,503.04 billion as of June 30, 2021, which was fourth largest among the peers, according to the CRISIL Report. Similarly, the MAAUM from individual investors was Rs 1,333.53 billion as of June 30, 2021. As per financial performance, ABSL AMC has posted total income/net profits of Rs.1407.25 cr. / Rs. 446.79 cr. (FY19), Rs. 1234.76 cr. / Rs. 594.23 cr. (FY20), Rs. 1205.84 cr. / Rs. 527.84 cr. (FY21). For Q1 FY22, company has posted revenue of Rs 336.24 Cr and net profit of Rs 156.45 Cr. So company has posted consistent growth in bottom-line, but sales are declining over last couple of years. Company has posted an average EPS of Rs. 17.44 and average RoNW of 34.05% for last three fiscals. Issue is priced at a P/BV of 11.38 as per NAV of 62.57 on 30.06.21. If we annualise latest earnings and attribute latest earnings of Q1 FY22 on fully diluted equity post issue, then asking price is at P/E of around 33 and as per FY21 earnings P/E is 39. As per RHP, comparison between listed peers are shown in above table. On BRLM's front, eleven BRLMs are associated with this IPO, and have handled around 156 IPO in last three fiscals. From last 10 IPOs, 7 are opened below issue price and remaining are opened above issue on the day of listing. As of now, all are trading above issue price. ( As on 24.09.21) As per financials, company has shown muted results, RoNW is 30.87% and P/E is around 39 as per FY21 earnings, which looks fully priced. As financial awareness is increasing, MF companies are growing and this trend should continue. Performance of BRLM is good. So, we are giving NEUTRAL rating to this IPO and one may apply for long term perspective.
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