Motilal Oswal has retained its ‘Buy’ rating on ICICI Prudential Asset Management Company (AMC) and maintained the 12-month price target at Rs 3,800, implying an upside of over 23% from the current market price. The brokerage house stated that the company has multiple long-term growth drivers, which support earnings compounding.

ICICI Pru AMC is India’s leading active asset manager with mutual fund Quarterly Average AUM (QAAUM) of Rs 11.2 lakh crore. The company commands the highest industry market share in both active mutual funds (13.5%) and equity-oriented hybrids (26.6%). Its equity QAAUM grew at an impressive 33% CAGR over FY21-26 to Rs 6.1 lakh crore, significantly outpacing the overall industry’s growth of almost 29%.

The alternatives business (including Portfolio Management Services (PMS), Alternative Investment Funds (AIF), and advisory services) is expanding rapidly and serves as a highly profitable earnings diversifier. Alternatives QAAUM reached Rs 79,450 crore in June 2026 (representing a 50% CAGR over FY23-26) and contributed 10% of operating revenue. This segment offers superior monetisation with PMS and AIF net yields of 95 bps, and its competitive position has been further strengthened by the integration of ICICI Venture and the approved acquisition of ICICI Securities’ PMS business.

The company has successfully built growth engines beyond traditional mutual funds to capture changing investor preferences. These include:

ICICI Prudential AMC’s extensive distribution network of over 1.16 lakh distributors and 286 offices supports strong flow visibility and retail stickiness. The company now serves 17.3 million unique investors and captured 70% of the entire industry’s incremental customer additions during Q1FY27. Furthermore, its resilient SIP franchise maintains the highest market share in flows at 15.4% as of Q1FY27.

The company’s revenue yields remain best-in-class, driven by its leadership in higher-yield active equity and hybrid assets. Recent regulatory changes regarding Total Expense Ratio (TER) caps have been fully passed through to distributors with minimal impact on profitability. Because the company’s operating cost base is predominantly fixed-cost in nature, projected AUM growth is expected to translate into healthy operating leverage and strong cash generation over FY26-28.

The share price of ICICI Pru AMC has risen 5.6% in the last five trading days. The stock has surged 3.7% in the past one month and 4.3% in the past six months. ICICI Pru AMC’s stock price has given a return of more than 26.3% over the previous 12 months.

The company posted a 23% rise in net profit to Rs 965 crore during the June quarter of FY27, compared to a net profit of Rs 784 crore in the same period a year back.

Its revenue from operations during the quarter surged 17.5% to Rs 1,564 crore compared with Rs 1,331 crore in the corresponding quarter a year ago. Its total income during the quarter advanced 18% to Rs 1,745 crore as against Rs 1,477.52 crore in the same period a year ago.