Questions across 9 calls

Navneet Munot

Firm not listed in source transcripts

HDFC Asset Management Company Limited

HDFC Asset Management Company Limited · 2026-07-15

I think the SIP flows remain very healthy for the industry. Over the last 6 months or so, they have been about INR30,000 crores. We have a healthy share within that. What we disclose is inclusive of the systematic transfer plan. So, we disclose systematic transactions, which include both SIP and STP and which have seen like healthy growth over the last several months despite the market volatility.

So, thank you for the compliment, Devesh. But on the debt side, we have seen money coming into the liquid fund, liquid and the overnight, while redemptions on the debt category. Last few months, the volatility in rupee, the volatility in interest rates, given the global environment , crude oil prices, etcetera, we have seen investors redeeming from the debt funds, but we have seen incremental inflows into the liquid fund for the industry as a whole, and we also have a decent share to get impacted by that, both sides, I mean.

HDFC Asset Management Company Limited CC-Jul26.pdf · 2026-07-15

I think the SIP flows remain very healthy for the industry. Over the last 6 months or so, they have been about INR30,000 crores. We have a healthy share within that. What we disclose is inclusive of the systematic transfer plan. So, we disclose systematic transactions, which include both SIP and STP and which have seen like healthy growth over the last several months despite the market volatility.

So, thank you for the compliment, Devesh. But on the debt side, we have seen money coming into the liquid fund, liquid and the overnight, while redemptions on the debt category. Last few months, the volatility in rupee, the volatility in interest rates, given the global environment , crude oil prices, etcetera, we have seen investors redeeming from the debt funds, but we have seen incremental inflows into the liquid fund for the industry as a whole, and we also have a decent share to get impacted by that, both sides, I mean.

HDFC Asset Management Company Limited CC-Apr26.pdf · 2026-04-16

Sure. Thank you, Sucrit. So , as you can see over the last couple of years, industry has grown from strength to strength. Over the last couple of years, we are seeing tremendous focus on expanding the systematic book across all channels, across all geographies, across all investor segments. And while the industry has grown, we have got our fair share. We continue to focus on that, continue to serve investors across various channels through the physical branch network that we have, where we have significantly expanded in last couple of years, and we will continue to evaluate opportunities on that side. And on the other side, continue to invest in our digital capabilities, both our portal, website, and as well as the app are best -in-class in the industry. If you look at the transactions which used to be almost 30% physically done five, six years back, are almost now 97% or so get done digitally. So , we believe in what I call phygital - continue to expand our physical base to serve our distributors, our investors across the country and on the other side, best-in-class digital capabilities to serve our investors. On the product side, I mean as per the SEBI classification, most of the categories that a mutual fund house can have, we are present in all of those categories. Our aspiration is to, is to keep growing our market share in all of those categories, keep delivering good returns to the investors. They have more faith and then we get more money in those products and on the other side, continue to build our distribution capability. Over the next several years, apart from the mutual funds, we also see opportunities to grow the non-mutual fund side of the business, which includes our PMS capabilities. We had some early wins as, as well as on the alternatives side. In the initial comments, Simal has mentioned about what we are doing on the private credit side, on the Category 2 AIF, on the fund of fund side. And over a period of time, you will hear more from us on that side. The other opportunity I will highlight is on the in ternational business. So, we have a 100% wholly-owned subsidiary in GIFT City, where we have five funds live. Over a period of time, we want to continue to build the product range and the distribution capability on that side, both for inbound money from gl obal investors investing into India and outbound Indian investors investing globally. So, some of these are where we'll continue to focus.

So, as I mentioned earlier that we have a good long -term track record across all strategies and on the other side, the work that we have been doing on the distribution side and given the product range, the performance track record, the platform that we have, over a period of time, we want optimized market share across all products. Incrementally, what I mentioned earlier on both what we are doing on physical presence, relationship with all channels, be it our mutual fund distributors, tens of thousands of them across the country. All the national distributors, the aggregators, all the banks where we have relationship and of course, the fin-tech channel, which has been growing quite a bit over the last couple of years. We continue to focus on each one of them, some of the other things I've mentioned earlier.

HDFC Asset Management Company Limited CC-Oct25.pdf · 2025-10-15

Thank you. So, over the last 25 years, we have built a significant franchise. You mentioned about the product. I think we have an absolutely best -in-class product bouquet. We have a very long-term performance track record, funds going back 5, 10, 15, 20, 25, 30 years of track record. We have presence across 280 branches, physical offices, and as wel l as absolutely best -in-class digital assets. We have partnerships with hundreds of thousands of distributors, banks, national distributors, MFDs, and of course, our presence on fintech and serving direct customers. We have like 14 million customers that we have been serving. We see tremendous potential for growth in our industry. I think with all of this, what we have put in place over the next several years, along with the pedigree of the HDFC brand, we see tremendous growth. We continue to invest in everything that I have mentioned so far, having the best people across our investment, risk, product, and all other functions, continue to expand our presence. Over the last two years, we have opened 50 new offices, a large number of them are in what we call in our industry B30 towns, in the smaller towns where penetration is still low and given our pedigree, brand, and everything else , we see a lot of potential to grow there. We continue to invest in our digital assets, in our technology to create the best possible experience for our investors and distribution partners. And we see a lot of growth apart from the mutual funds where we have been one of the dominant players. We have been investing to grow in the alternative space, in the PMS space, and of course, offering all of this to global institutions who would like to invest in India.

I think I answered what are the things that we have been doing, but maybe another way to put it is , it may sound very audacious, but we have put a mission for ourselves that is to be the wealth creator for every Indian. We serve 14 million investors, but we think we have a long way to go, if we have an audacious mission like that. And our vision may sound even more audacious, which is to be the most respected asset manager in the world. And for that, I think our entire team wo uld not leave any stone unturned to ensure that we create value for each and every stakeholder, be it our people, be it our shareholders, be it our clients, be it our distribution partners, be all our vendors, ecosystem partners, and society at large. So, maybe some of the things are getting covered in the presentation and the other things that we put it on our website, but I think we get governed and get inspired by our mission and vision every day.

HDFC Asset Management Company Limited CC-Jul25.pdf · 2025-07-17

Sure, sure. While Naozad has explained it in detail. I will just add that the HDFC Group has consistently championed employee ownership across its companies. At HDFC AMC, we have no doubt that our people are central to delivering consistent, sustainable long -term value to our client s and shareholders. So, aligning employee interest with those of shareholders, clients and other stakeholders is fundamental to group's way of thinking. This reinforces our ethos while also responding to the evolving expectations of talent and the changing dynamics of industry. So, I view this not as a cost, but as a long-term investment in building and retaining high-quality talent. Also, I would like to add 1 thing that under the new plan, ESOPs and PSU put together have been granted to over 800 people. That is 50% of our workf orce across levels. So , we are broadening ownership and deepening alignment. While the accounting charge is noncash in nature that Naozad has explained. So, for FY '26 if I assume an average AUM of let's say INR8.5 trillion. The estimated impact is well below 1 basis point of AUM or to be exact about 0.8 basis points.

The third question was on SIF.

HDFC Asset Management Company Limited CC-Mar25.pdf · 2025-04-17

So, I mean the management fees is same, in direct as well as the regular plan. So, that wouldn’t be impact. It’s broadly been in line with the last quarter. I think we have been saying in the last quarter also that equity is around 58 basis points, debt is 28 basis points and liquid is 12 basis point s and revenue margins over the last four quarters if I remember correctly in Q1 was 46 .3 with equity asset mix was 64%, in Q2 was 46.4 with mix coming in slightly higher; 65.7, Q3 was 47.1 with again a similar mix , and this time the mix was slightly lower at 63.8 and Q4 margins were 47.2.

Sure. So, firstly, as of now, we are seeking approval from shareholders for stock options/performance stock units (PSU). This is not what we are giving or allotting as of now. This is for future. This gives me an opportunity to give you a perspective on what this is about. So, in HDFC AMC, we recognize that our people are central to delivering consistent , long-term, sustainable value to ou r clients and shareholders. And as part of our efforts to attract, retain and align high quality talent with business outcome, the (NRC), the Nomination and Remuneration Committee of the Board approved these changes . I n 2020 we had secured shareholder approval to allocate approximately 32 lakh shares to employees overtime. Since then, out of these 32 lakh shares, NRC has granted around 23 lakh shares. That remaining 8.7 lakh s have now been cancelled . So, no further shares will be allotted under that scheme. ` The NRC has approved a new scheme that is ESOP and PSU Scheme 2025. This will now go for shareholder approval . So, we are seeking approval for 25 lakh shares, including Performance Stock Units (PSUs). It will be an NRC’s prerogative to allocate these shares over a period of time. Last time, we took approval in 2020 for 32 lakh shares, as I mentioned , and of that we are cancelling 8.7 lakhs . The balance 23 lakh shares were allocated over the last five years including 10.5 lakh shares to over 600 of our people in 2023. The previous scheme had vesting spread equally over three years. New scheme will have deferred vesting, that is 10% in first year, 20% in 2nd, 30% in 3rd and 40% in the 4th, so 10, 20, 30, 40 over a four-year period. And we are of the opinion that this is better aligned with the interest of our shareholders and reinforces long- term performance. The NRC has also approved the issuance of PSUs within this overall limit of 25 lakh shares. So, 25 lakh includes both, the ESOPs as well as the PSUs. PSUs will be granted at face value and will vest 30% in 3rd year and 70% in 4th year contingent upon meeting clearly defined performance parameters primarily based on revenue, profitability, etc. Importantly, and I must sa y this PSUs will not be granted to me or my direct reports who are classified as head of department. The HDFC group have consistently championed employee ownership across its companies and this new framework reinforces that ethos while responding to the evolving expectations of talent and demand of our industry. So, let me reiterate that there is no intention of allotting entire 25 lakh shares at this instance. It will be spread over time similar to our old scheme and we’ll come back to you after the shareholder ap proval and the discussion with the NRC on allocation, etc.

HDFC Asset Management Company Limited CC-Dec24.pdf · 2025-01-14

Thank you, P rayesh. So, on the SIP number, I think as AMFI has repeatedly mentioned, I think we need to look at ; one, the gross flows and the redemption from the existing AUM. So, one is the flow, and another is from the stock. Let me try to clarify this with an example. So, let's assume that I'm doing a monthly SIP of INR10,000 for the last five years. So, by now, I would have invested INR6 lakhs and say the market value is now INR10 lakhs. Now, I decide to pull out INR5 lakhs for any reason and continue with my monthly contribution of INR10,000. So, for this one month, my net SIP will be negative INR4.9 lakhs. So, this is nothing , but book versus the flow issue. Also, it's possible that I'm no t pulling money out. I'm just switching INR5 lakhs from Fund X to Fund Y. This would again mean a negative SIP of INR4.9 lakhs and a positive lumpsum of INR5 lakhs. So, in a nutshell, what I'm trying to state is when we speak of SIP, let's look at gross flows. As far as we are growing there, it is good news. And now, as you know that the SIP AUM, if I remember correctly, is over INR13 lakh crores. That number is very significant. So, any movement from there would impact that net number. But my request would be to look at the number that AMFI discloses on the gross side.

So, the number that we disclosed at INR26,000 crores in the last month is the money in the bank. That's the total money. And that has been a n increasing trend. Within that, of course, in the last three or four years, the overall number of accounts have gone up exponentially. I mean, industry, if I remember correctly, 10 -12 years back used to do around 1.5 lakh new accounts per month. Now, that number is more than 50 lakhs. So, obviously, you would have a, maybe that gross and net number in terms of accounts moving much more sharply than what we were used to. But most importantly, again, I would repeat the same thing, most importantly would be the gross number of flows that are coming to us. Simal Kanuga Actually, Prayesh, also we need to look at it on the denominator. So, just we pulled out some data here. If you look at in April of 2024, there were 8.7 crores transactions in SIP. Now, that num ber has gone to 1,032 lakhs, so 10 crores transactions. And if you look at it, so the cancellation now has gone from 33 to say 44.90. So, that 4% is the cancellation ratio of the outstanding account. Looking at it in absolute sense may not give you the right picture.

HDFC Asset Management Company Limited CC-Sep24.pdf · 2024-10-15

So apart from the money that might be coming from the NRIs in our existing funds, what we are trying to do is we have set up a who lly owned subsidiary in GIFT City, our HDFC AMC International IFSC and there one of our products is going live very soon. And then we'll have another three products, all these four will feed into domestic mutual funds. And we think that from a procedure pe rspective as well as our ability to raise more money from the diaspora from different parts of the world would be greater.

Sure. So, on the new asset class, the way I look at this, it is one more opportunity for us. Currently, mutual funds are well bucketed by categories. You have like large cap, small cap, multi -cap, etcetera. They have restrictions on single stock exposure. And this will open up a new avenue with higher levels of flexibility and higher risk reward profile for a set of investors who are looking for the same. This will fall between mutual funds and let's say PMS or AIF where the minimum amount is higher than what in this new asset class would be. There would be potential for greater use of derivatives, greater flexibility for having more innovative investment strategies. One thing is clear that regulators want this category to be within the strong rea lm of mutual fund regulations. This means there will be some restrictions, well laid out principles, but this will open up more opportunities for us.

HDFC Asset Management Company Limited CC-Jun24.pdf · 2024-07-15

We had 24 branches that we opened in the first week of January. I think in the next few weeks or few months, I mean, we don't have plans to add many more.

So, while we want to grow all our segments, but you would appreciate that in case of equity, the re are 2 variables, number one, the mark -to- market gain will relatively be higher than other asset classes that will push the equity proportion higher within our overall AUM. And second is the SIP book, which is now a very large part of the overall flows. So , a large part in fact, bulk of the SIP flows are into equity funds. So , the equity proportion by that should increase at a faster pace. But as I mentioned earlier, our intent would be to like g row all our segments of business, including fixed income and other.