Industry Context

  • Industry quarterly average AUM grew by 15.4% YoY and 2% sequentially to INR 83.28 lakh crore in Q1 FY27
  • Equity and equity-oriented AUM stood at INR 45.2 lakh crore
  • Market segments performance: Small-caps returned 24%, mid-caps 17.2%, large-caps 8.9%
  • Equity net flows were INR 1.14 lakh crore for the quarter, reduced by INR 10,064 crore sequentially
  • Mid-cap and small-cap categories attracted highest equity net flows; thematic and hybrid funds faced reduction
  • June 2026 SIP contributions reached INR 31,781 crore, rebounding 26% month-on-month from May lows
  • Debt segment quarterly average AUM stood at INR 11.93 lakh crore, moderating 6% sequentially due to institutional redemptions amid tight liquidity
  • Passive quarterly average AUM grew 25.3% YoY and 1.5% sequentially to INR 14.73 lakh crore
  • Industry customer base reached 6.2 crores, up 12.1% YoY

Company Financial Performance (Q1 FY27)

  • Operating revenue: INR 1,564 crore, up 17.6% YoY
  • Revenue mix: Mutual fund (90.02%), alternates (8.54%), advisory (1.44%)
  • Other income: INR 181 crore (turned positive from negative due to positive mark-to-market)
  • Operating expenses: INR 464 crore, up 11.7% YoY and 14.3% QoQ
  • Operating profit before tax: INR 1,100 crore, up 20.2% YoY
  • Profit after tax: INR 965 crore, up 23.1% YoY
  • Gross yield (annualized): 52.4 basis points
  • Net yield (annualized): 48.3 basis points (after reducing PMS/AIF fees and commission expenses)
  • Operating margins: 36.9 basis points vs 36.1 basis points in Q1 FY26
  • ESOP expenses: Started debiting from this quarter (full-year FY27 cost estimated INR 64-68 crore)

AUM and Market Share Details

  • Total mutual fund quarterly average AUM: INR 11.17 lakh crore, up 1.1% QoQ and 18.3% YoY
  • Market share: 13.4% (second largest AMC)
  • Active schemes market share: 13.5% with AUM of INR 9.25 lakh crore
  • Equity and equity-oriented schemes: Market share 14% with AUM of INR 6.31 lakh crore, up 19.8% YoY (outperforming industry by 3.6%)
  • Equity-oriented hybrid schemes: AUM of INR 2.22 lakh crore with 26.6% market share (largest)
  • Margins (annualized): Equity (66 bps), debt (32 bps), liquid (12 bps), passives (12 bps), arbitrage (30 bps)
  • No negative impact from TER regulation changes
  • Unique customer base: 1.73 crores; added 7 of 10 new industry customers in the quarter

Systematic Investments and Distribution

  • Systematic transactions (SIPs + STPs): INR 4,872 crore in June 2026 (moderated from INR 5,104 crore in March 2026)
  • Trend: Moderate dip in April-May followed by June rebound, in line with industry
  • Distribution mix of equity AUM: MFDs (36.2%), national distributors (15.9%), ICICI Bank (7.7%), other banks (10.7%), direct (29.5%)

Specialized Investment Funds (SIF)

  • iSIF brand for SIF products launched by ICICI Prudential MF
  • Four strategies launched: iSIF Equity Ex Top 100, iSIF Hybrid Long-Short Fund (previous quarter), iSIF Active Asset Allocator Fund, iSIF Equity Long-Short Fund (June 2026)
  • Quarterly average AUM: INR 2,678 crore
  • Category considered to have long-term potential with greater flexibility for fund managers

GIFT City Business

  • First offering: ICICI Prudential Smart Navigator Fund (inbound fund)
  • Fund gaining traction and witnessing growing investor interest
  • Evaluating more product opportunities (both inbound and outbound)

Alternates Business (PMS & AIF)

  • Includes listed equity focused PMS and AIF, private credit, real estate, private equity, early stage private equity, and offshore advisory
  • Quarterly average AUM: INR 79,446 crore (restated for ICICI Venture acquisition)
  • PMS quarterly average AUM: INR 28,996 crore (up 8.1% sequentially)
  • AIF quarterly average AUM: INR 22,737 crore
  • Gross yield (annualized): 1.91%
  • Net yield (annualized): 0.95% (after reducing fees and commission expenses)
  • Advisory yield: 30 basis points
  • Net yields typically hover between 90-100 basis points depending on product mix

AI Initiatives

  • Three core pillars: customer/distributor experience, operational efficiency, investment management
  • Natural language search engine processed over 5 million queries
  • Hyper-personalized prompts in mobile apps and distribution portal
  • 60% of customer email queries replied using AI
  • AI-driven outbound SIP renewal calling process
  • Proprietary platform for conversational layer over investment data
  • AI used to generate summaries of reports, videos, DRHPs

Q&A Highlights

SIP Trends: Management noted industry SIP flows showed rebound in June after May dip, emphasizing quarterly trends over monthly volatility. Quality of sales (responsible distribution vs self-selected) determines SIP sustainability.

Expense Guidance: Employee expenses increased due to ESOP charges starting this quarter (INR 64-68 crore for FY27) and April salary hikes. Fee/commission increase reflects PMS/AIF business growth.

Product Pipeline: Upcoming launches include life cycle funds (2031, 2036, 2041 target dates), contra category, sector rotation SIF, commercial real estate series, and multiple ETF ideas.

Market Share: Changes primarily driven by mark-to-market performance across segments (small-cap +24%, mid-cap +17.2%, large-cap +8.9%) rather than net flows in one quarter.

Debt AUM: Sequential moderation due to institutional redemptions amid tight liquidity conditions and increased corporate working capital needs.

Investment Book: Approximately 50% comprises seed capital subject to mark-to-market; positive MTM of INR 181 crore in Q1 vs negative in Q4 FY26.

Small/Mid-cap Valuations: Management noted situation differs from September 2024 after two years of mediocre performance, but avoided specific market calls.