JP Morgan picks Angel One, CAMS, HDFC AMC among top capital-market stocks; check targets

Ahead of NSE IPO, JP Morgan has initiated coverage on capital-market stocks with a positive view on India’s long-term financialisation story, saying the sector remains anchored by Systematic Investment Plan-led (SIP) flows despite weak equity returns and sustained foreign selling.

The report said the Nifty 50 delivered a two-year CAGR of 0.8 per cent in rupee terms and minus 3.2 per cent in US dollar terms, while foreign portfolio investors sold $36 billion (Rs 3.3 trillion) of Indian equities over FY25 and FY26. According to it, SIPs have become the sector’s demand anchor, contributing 77 per cent of total equity and balanced net inflows in FY26. 

It said monthly industry SIP flows rose 48 per cent to Rs 31,000 crore in May 2026 or $3.3 billion, while cumulative equity and balanced fund net inflows stood at Rs 9.43 lakh crore or US$109 billion. It said these inflows should continue with support from tax and policy changes, and added that its stock selection reflects business-model quality, regulatory exposure and valuation.

JP Morgan said the Nifty’s flat performance over the past two years shows retail participation has continued through volatility. It said that equity’s relative appeal has improved because long-term capital gains tax on equity is 12.5 per cent, while the removal of indexation, taxation of insurance policy proceeds and slab-rate taxation for debt mutual funds have supported the case for equities.

JP Morgan said exchange volumes have scaled structurally, led by index options. Industry average daily premium turnover has risen from Rs 1,000 crore in FY14 to Rs 69,900 crore in FY26, helped by weekly expiry proliferation and retail and algorithmic participation. 

In commodities, MCX saw what the report described as a cycle-driven surge, with FY26 futures average daily turnover rising 138 per cent year-on-year to Rs 64,200 crore on stronger bullion and energy prices. JP Morgan said it sees limited risk to derivative volumes from potential restrictions on retail participation.

On stock preferences, JP Morgan said it prefers Angel One (Target Price: Rs 420) over CAMS (Target Price: Rs 950), ICICI AMC (Target Price: Rs 4,090), NAM India (Target Price: Rs 1,360) and HDFC AMC (Target Price: Rs 3,250). It has initiated with an 'overweight' rating on all these counters.

JP Morgan has a neutral rating on BSE (Target Price: Rs 4,330) and Kfin Technologies (Target Price: Rs 980), while saying it is waiting for a better entry point in latter one. However, it is underweight on CDSL (Target Price: Rs 1,200) and MCX (Target Price: Rs 2,560). 

The report said exchanges and depositories have stronger pricing power and operating leverage, brokers benefit from scale, asset managers are less cyclical because they are linked to assets under management, and mutual fund RTAs have lower pricing power and operating leverage.

JP Morgan said key triggers for the space include persistent market-share gains, margin improvement through operating leverage, SIP flows staying above Rs 300 billion and post-TER implementation yield outcomes with an impact of less than 1 basis point. 

It said the key risks are SIP inflows staying below Rs 25,000 crore for a sustained period, adverse regulation leading to a 20 per cent fall in derivative volumes or cancellation of weekly expiries, and futures or premium turnover moving more than 15 per cent above assumptions during a sharp rise in volatility.