Nippon Life India Asset Management

Robust AUM growth, equity assets share rises to 41.3%

Jul 19, 2021 11:07 IST capital market

Nippon Life India Asset Management has posted 16% surge in the net profit to Rs 181.54 crore in the quarter ended June 2021 (Q1FY2022) compared to Rs 156.30 crore in Q1FY2021, driven by strong growth in assets and cost efficiencies. The company has exhibited 3% decline in employee expenses and 4% rise in other expenses in Q1FY2022.

The operating profit of the company surged 64% to Rs 177.36 crore, but other income declined to Rs 66.91 crore in Q1FY2022 from Rs 103.06 crore in Q1FY2021.

Interest expense declined 26% to Rs 0.93 crore. The depreciation declined 30% to Rs 7.31 crore in Q1FY2022. The profit before tax moved up 18% to Rs 236.03 crore. The effective tax rose to 23.2% in Q1FY2022 from 21.8% in Q1FY2021. The net profit increased 16% to Rs 181.54 crore in Q1FY2022 from Rs 156.30 crore.

Business highlights:

Assets under management increased 38% to Rs 378769 crore end June 2021 over Rs 180061 crore end June 2020.

Average Mutual Fund assets under management moved up 33% to Rs 240364 crore end June 2021.

Overall AUM market share rose to 7.25% - an increase of 13 basis points as against the quarter ended March 2021

The share of Equity Assets rose to 41.3% of AUM as against 37.8% for the quarter ended June 2020. The equity asset increased 48% to Rs 128900 crore.

The company has one of the largest retail assets in the Industry, at Rs 69,579 crore. Retail assets contributed 28% to AUM.

Beyond the Top 30 cities contributed AUM of Rs 47,158 crore end June 2021. This segment forms 19% of AUM of the company compared with 16% for the Industry.

Individual AUM was Rs 123673 crore and contributed 50% to AUM of the company.

As on June 2021, the company is one of the largest ETF players with AUM of Rs 40,809 crore and a market share of 13%.

The company has 1.1 crore investor folios, with an annualised systematic book of over Rs 7,000 crore.

Nippon India AIF offers Category II and Category III Alternative Investment Funds and has a total commitment of approx. Rs 3800 crore across various schemes.

The company has geographical presence at approx. 280 locations pan India, and is amongst the highest in the industry

For the quarter ended June 30, 2021, digital purchase transactions rose to 6 lakh - an increase of 28% as against quarter ended March 31, 2021. Digital channel contributed 58% to total new purchase transactions.

Sundeep Sikka, ED & CEO, NAM India, said I am happy to share that NAM Indias continuous focus on strong profitable growth has been yielding positive results. In this quarter, we increased our market share and overall investor base, led by a keen retail-driven approach, robust product suite and, dedicated efforts to grow across all asset categories. We are dedicated to the philosophy of consistently creating value for all stakeholders. In this journey, we began our association with United Nations supported Principles for Responsible Investment (UN-PRI). By successfully integrating the tenets of ESG with responsible investment and building a formidable digital presence, we are confident of regaining our market positioning as well as recreating and reinventing NAM India by continuously innovating and disrupting ourselves.

Financial Performance FY2021

Nippon Life India Asset Management has posted 63% increase in the net profit to Rs 680.33 crore in the year ended March 2021 (FY2021). The operating profit of the company declined 8% to Rs 557.52 crore, while other income zoomed to Rs 357.20 crore in FY2021, driven by mark-to-market gains on the investment portfolio from loss of Rs 9.777 crore in FY2020.

The depreciation was flat at Rs 33.27 crore in FY2021. The profit before tax moved up 57% to Rs 877.02 crore. The effective tax was lower at 22.5% in FY2021 from 25.7% in FY2020. The net profit increased 63% to Rs 680.33 crore in FY2021.

Nippon Life India Asset Management: Consolidated Results

 

2106 (3) 2006 (3) Var % 2103 (12) 2003 (12) Var %
Sales 302.27 233.12 30 1062.14 1202.98 -12
OPM % 58.7% 46.5% 52.5% 50.6%
OP 177.36 108.37 64 557.52 608.50 -8
Other Income 66.91 103.06 -35 357.20 -9.77 LP
PBDIT 244.27 211.43 16 914.72 598.73 53
Interest 0.93 1.26 -26 4.43 5.67 -22
PBDT 243.34 210.17 16 910.29 593.06 53
Depreciation 7.31 10.50 -30 33.27 33.25 0
PBT 236.03 199.67 18 877.02 559.81 57
Tax 54.65 43.55 25 197.63 144.05 37
PAT 181.38 156.12 16 679.39 415.76 63
Minority interest 0.00 0.00 - 0.00 0.00 -
Profit/Loss of Associate Company 0.16 0.18 -11 0.94 -0.51 LP
PAT 181.54 156.30 16 680.33 415.25 64
EPS (Rs)* 11.7 10.1 11.0 6.7
*EPS is annualized on latest equity of Rs 618.39 crore, face value of Rs 10 each, Source: Capitaline Corporate Database

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