NAM India FY25 Results : Record Profits, Growing AUM & Digital Push

Rahul Chaudhary

3 months ago

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Nippon Life India Asset Management Ltd (NAM India): FY25 Results and Business Update

Nippon Life India Asset Management Ltd (NAM India) ended FY25 on a strong note. The company achieved its highest-ever profits and showed steady growth in assets, digital presence, and investor base. Here’s a simple breakdown of the company’s performance, strategies, and plans.

Who Spoke at the FY25 Concall?

The leadership team from NAM India shared key updates:

Sundeep Sikka (CEO)
Parag Joglekar (CFO)
Saugata Chatterjee (Chief Business Officer)
Amol Bilagi (Deputy CFO)
Arpanarghya Saha (Chief Digital Officer)
Arun Sundaresan (Head of ETF)
Ashish Chugani (Head of AIF)
Aashwin Dugal (Deputy Head of AIF)
Shin Matsui (Nominee from Nippon Life Insurance, Japan)

NAM India reported a total Assets Under Management (AUM) of ₹6.54 trillion by March 2025. This includes mutual funds, managed accounts, offshore assets, and GIFT City operations.

Mutual Fund AUM stood at ₹5.57 trillion, growing 29.2% from last year.
Overall MF market share increased to 8.26%.
Equity market share rose to 6.86%. Excluding arbitrage, it reached 6.92%.
Equity assets made up nearly half (49.8%) of the overall AUM.

Record-Breaking Profits in FY25

NAM India posted its highest-ever profit of ₹12.86 billion in FY25, growing 16% year-on-year.

Other key highlights:

Operating profit for FY25 was ₹14.04 billion (+47% YoY).
Q4FY25 revenue reached ₹5.67 billion, up 21% from the previous year.
Net profit in Q4 stood at ₹2.99 billion.
Dividend payout was ₹18 per share, which is about 91% of the year’s profits.

Outlook on Costs and Margins

The company shared guidance for FY26 expenses and yields:

Operating costs (excluding ESOPs) may grow around 15%.
ESOP cost is expected to rise slightly to ₹48–49 crore.
The tax rate is likely to be around 24–25%.
Average yield was 37 basis points in FY25, which might drop by 2–3 bps next year.

Here’s a quick look at yields across asset classes:

Equity: 57 bps
Debt: 25 bps
Liquid funds: 10–12 bps
ETFs: 15 bps

Strong SIP Book and Retail Growth

NAM India’s SIP market share was 10.16% as of March 2025. That’s double what it was three years ago.

Monthly SIP collections hit ₹31.8 billion (+37% YoY), annualized at ₹382 billion.
SIPs continued to grow steadily with a low stoppage rate.
The product mix across SIPs was designed to stay stable during market shifts.

Largest Investor Base in the Industry

The company now serves 20.8 million unique investors, which is the highest in the mutual fund industry. The overall industry has 54.2 million investors, growing 22% over the year.

Digital Is a Key Growth Driver

NAM India’s digital reach is growing fast:

Q4FY25 digital transactions crossed 3.54 million (+49% YoY).
For the year, total digital transactions were 14.4 million, double from FY24.
74% of new purchases in Q4 came through digital platforms.

Leading the ETF Market

NAM India continues to lead in Exchange Traded Funds (ETFs):

ETF AUM reached ₹1.54 trillion.
Market share in ETF AUM rose to 19.07%.
53% of ETF folios in India belong to NAM.
NAM captured 53% of NSE/BSE ETF trading volume, and 73% in NIFTY ETFs.
The company avoids complex ETFs with low liquidity and focuses on well-traded products.

Growth in Alternatives and Global Business

NAM India is also growing in alternate and offshore markets:

AIF commitments reached ₹74.1 billion, with ₹13 billion raised in FY25 (2.2x growth).
Offshore AUM rose to ₹152 billion (+13% YoY).
A UCITS Equity Fund manages ~$483 million.
The firm launched new products for Japanese retail investors via Nissay AMC.
Active in Japan, Taiwan, and Thailand; planning to expand in Europe.
Offshore yields range between 6 to 100 bps, depending on the product.

New Strategies and Leadership Moves

The company welcomed Andrew Holland to lead new asset classes. A few upcoming products include:

Long-Short Equity Fund
A second India-focused Venture Capital Fund of Funds

Key distribution strategies:

No large or thematic active fund launches.
Focus on growing current successful funds.
Selectively launch passive funds.

NAM has also started repricing equity distribution — already 45–50% of the equity portfolio has been repriced, and more is expected.

The company added 160 new employees this year. For FY26, it plans to hire 75–100 more people.

Industry Trends and Market Update

The Indian mutual fund industry’s QAAUM rose 24.6% YoY to ₹67.4 trillion.
Equity funds made up 60% of the total AUM in Q4.
Inflows and trends in Q4FY25:
- Equity funds: Gross ₹2.13 trillion; Net ₹1.04 trillion
- SIP flows: ₹783 billion (+37% YoY)
- Debt and Liquid funds: Net outflow of ₹809 billion
- ETFs: Net inflow of ₹216 billion

Stock market summary:

NIFTY fell by 0.5% QoQ.
Mid and Small Caps dropped 9.6% and 14.9% respectively.
RBI cut repo rate by 25 bps to 6.25%.
10-year G-Sec yield fell by 18 bps to 6.58%.

Cybersecurity Update

In April 2025, NAM India experienced a cyber attack. The affected areas were quickly isolated, and critical systems were restored. There was no major impact on customer data or operations.

Capital and ESOPs

NAM India follows a dividend policy of 60–90% payout. For FY25, the payout stood at 91% of profits.

In April 2025, the company issued:

416,972 PSU units at ₹10 each.
1.72 million ESOP options at ₹577.79 each.

Management’s View on Future Plans

SIP and Retail

NAM India sees strong momentum in SIPs and wants to keep its product lineup diverse and stable.

Offshore Strategy

There were some valuation changes (mark-to-market), but no actual outflows. The team is optimistic about growth in Japan, especially through NISA investors.

Expense and Yield

Costs will grow moderately.
Yield pressure from ETF mix and repricing has mostly been managed.

Product & Distribution

The company has capped inflows into small and mid-cap funds to manage risk.
Focus remains on core funds and existing schemes.

ETF Market

NAM India still leads in high-volume ETF categories like NIFTY ETFs, despite more players entering the space.

Debt Market View

Due to the RBI’s rate cut and maturing fixed deposits, the outlook is positive for short and medium-duration debt funds.

Challenges to Watch

While NAM India is doing well, a few challenges remain:

SIP growth is slowing across the industry, though NAM is still outperforming.
Market volatility, especially in mid and small-cap segments, is a concern.
Yields are shrinking due to the higher share of ETFs and lower pricing.
Cybersecurity risks continue to be an area of focus after the recent incident.

Final Thoughts

Nippon Life India Asset Management Ltd (NAM India) has wrapped up FY25 with record profits and strong business performance. The company is growing in size, reaching more investors, and leading in digital and ETF segments.

With smart cost control, careful product planning, and a growing global presence, NAM India is in a good position for FY26. The company’s focus on SIP stability, digital platforms, and offshore growth, especially in Japan, should help it continue this strong performance.