ICICI Prudential AMC vs HDFC AMC vs Nippon: Vinit Bolinjkar shares pecking order

The day ICICI Prudential AMC received a strong investor response on the listing, Vinit Bolinjkar, Head Research at Ventura Securities said he is positive on the asset management space as a whole and that ICICI Prudential AMC is his top pick in the pecking order, followed by Nippon Life India Asset Management Ltd (NAM) and HDFC AMC.   

In an interview to Business Today, Bolinjkar said investors need to keep one thing in mind that AMC comes under consumption space. If there is one secular trend, which can play out over a decade-and-a-half, it is the mutual fund business.

"And you know, ICICI Prudential AMC has a very strong brand equity. It has got a great distribution piece on the back of its parent, ICICI. And we think that this is one of the stocks which is still available relatively cheaper compared to the rest of the AMC stocks," Bolinjkar said.

He asked investors to stay invested in the ICICI Prudential AMC stock , build on more positions at current levels.

His second stock in the pecking order is Nippon Life India Asset Management Ltd because he believes that in spite of not being a bank-aided mutual fund, Nippon Life has got some very creditable performance given how it manages its portfolios.

"And the trust that investors show in this stock," he said.

Apart from this, Bolinjkar said that below these two stocks, HDFC, AMC also comes in as the next favorite. He said the valuations continue to remain rich, given the HDFC franchise.

On ICICI Prudential AMC,  he said valuations are decent and any dip should be used to add the stock to portfolio and increase weighting of the stock.

Earlier in the day, Centrum Broking initiated coverage on the debutant with a 'Buy' rating and a target price of Rs 3,181. Equirus, on the other hand, initiated coverage on the stock with a target of Rs 2,900. 

In the case of recent regulatory changes announced by SEBI, Bolinjkar said: "AMC stocks were higher because they were probably expecting that the SEBI will come, you know, heavily on them and may reduce the kind of fee that they charge by a large amount. But this was only saved by about 10 basis points or so in many cases."

"It is a graded response. The fears were overdone and the market is very happy that, it is not too much of a challenge and there are checks and balances out there."