Management

• Sandeep Batra (Chairman and Nominee Director)
• Nimesh Vipinbabu Shah (Managing Director and Chief Executive Officer)
• Sankaran Naren (Executive Director and Chief Investment Officer)
• Sidharatha Sankar Mishra (Nominee Director)
• Guillermo Eduardo Maldonado-Codina (Nominee Director)
• Ved Prakash Chaturvedi (Independent Director)
• Dilip Ganesh Karni (Independent Director)
• Naved Masood (Independent Director)
• Antony Jacob (Independent Director)
• Preeti Reddy (Independent Director)

Use of Proceeds

The total issue size is Rs.10,602.65 cr, which is entirely offer for sale (OFS) of Rs 10,602.65 cr.

Competitive Strengths

Market Leadership and AUM Profile The company is the largest asset manager in India by active mutual fund QAAUM, with a 13.3% market share and QAAUM of Rs 10,147.6 billion as of September 30, 2025. Leadership extends to Equity and Equity Oriented QAAUM, with a 13.6% share, and to Equity Oriented Hybrid QAAUM at 25.8%. Mutual fund equity and equity-oriented QAAUM reached Rs 4,876.5 billion as of March 31, 2025, reflecting a 40.0% CAGR since March 31, 2023, outpacing the industry. Individual investor MAAUM was Rs 6,610.3 billion, representing the highest Individual Investor MAAUM in the industry with a 13.7% share.

Product Range and Alternates Business A diversified product suite spans equity, debt, passive, fund-of-funds, liquid, overnight and arbitrage schemes, totaling 143 mutual fund schemes as of September 30, 2025. Equity and Equity Oriented Schemes constituted 55.8% of total QAAUM, supporting higher fee yields. The Alternates business, comprising PMS, AIFs and offshore advisory, reported a QAAUM of Rs 729.3 billion, with specialized strategies including private credit, long–short and office-yield funds. Advisory assets under management amounted to Rs 329.1 billion. The AIF portfolio includes Category II and III strategies with a cumulative QAAUM of Rs 146.5 billion, reflecting differentiated product development and scale.

Individual Investor Franchise and Systematic Flows The company’s Individual Investor base numbered 15.5 million as of September 30, 2025, with Individual Investors representing 61.1% of total MAAUM and 85.7% of equity and equity-oriented MAAUM. Systematic Transactions exhibited strong growth: monthly flows reached Rs 48.0 billion in September 2025 versus Rs 39.1 billion in March 2025 and Rs 23.5 billion in March 2023. Total Systematic Transaction folios rose from 5.7 million in March 2023 to 14.2 million in September 2025, with 92.5% of such transactions having tenures over five years. These flows support a resilient and predictable AUM base.

Distribution, Digital Capabilities and Customer Reach A pan-India, multi-channel distribution network comprised 272 offices across 23 states and four union territories as of September 30, 2025, supported by 110,719 MFDs, 213 national distributors, and 67 banks, including ICICI Bank. Digital initiatives include cloud adoption, upgraded websites, and the i-Invest mobile app, which recorded 2.2 million downloads and enabled 95.3% of purchase transactions on digital platforms for the six months ended September 30, 2025. Digital purchase transactions numbered 11.0 million in that period and 20.9 million for FY2025. Social media reach exceeded four million YouTube subscribers, aiding investor education and acquisition.

Governance, Investment Team, and Financial Strength The company operates with an established investment and risk framework supported by a research team and a dedicated risk function. The mutual fund investment team comprised 50 professionals; alternates investment personnel numbered 29, and the research team 17 as of September 30, 2025. Financial performance showed consistent profitable growth: operating profit before tax for the six months ended September 30, 2025, was Rs 19,328.2 million, and CAGR for total AAUM, operating revenue, and profit after tax was roughly 32% over FY2023–FY2025. Return on equity and operating margins reflected capital efficiency and sustained earnings generation.

Peer Comparison

Key Risks & Concerns

Sensitivity to Market and Economic Conditions The company’s revenue is closely tied to AUM levels across mutual funds, PMS, AIFs and offshore mandates, making it highly sensitive to market cycles, macroeconomic conditions and investor sentiment. Equity corrections, interest-rate shifts, credit events or weaker household savings can reduce inflows, trigger redemptions and compress fee income. Changes in investor behaviour, including movement toward lower-fee products or withdrawals following underperformance, may further affect the AUM mix and profitability. While AUM has remained stable recently, fluctuations remain an inherent risk given the company’s reliance on market-linked revenue streams.

Risk of Underperformance Across Investment Products Underperformance relative to benchmarks or peers can lead to investor redemptions, weak inflows, and pressure on high-fee categories. As of September 30, 2025, select equity, hybrid, arbitrage, debt, liquid, and overnight schemes underperformed over applicable periods, highlighting performance vulnerability. Persistent underperformance may weaken investor confidence, reduce pricing power, and lead to scheme rationalisation. Regulatory and contractual investment constraints may also limit strategic flexibility. Any sustained decline in AUM-particularly in equity and other premium segments-can materially impact overall revenues and profitability.

Reputational Dependence on ICICI Group and Prudential Group The company’s brand strength is deeply linked to its association with ICICI Bank and Prudential Corporation Holdings. Any reputational setback at the group level-arising from litigation, regulatory scrutiny, misconduct or adverse publicity-can negatively influence investor trust and business dynamics. Given the sensitivity of the asset management industry to credibility, such events could intensify regulatory oversight, dampen sentiment and trigger outflows. Although no material reputational issues have impacted the business recently, dependence on group reputation remains a structural and significant risk.

Regulatory Changes to Total Expense Ratio (TER) Framework Mutual fund profitability is directly influenced by SEBI’s TER regulations, and proposed changes may materially affect revenue streams. SEBI’s October 2025 consultation paper suggests tighter expense caps, removal of the additional 5 bps exit-load benefit, exclusion of statutory levies from TER limits, and reduced brokerage allowances. These changes could restrict management fee potential, limit distributor incentives, and challenge the viability of certain schemes. If performance-linked TER models are implemented, earnings volatility may increase, altering cost structures and requiring deeper operational adjustments by AMCs.

Outlook and Valuation

ICICI Prudential AMC stands to benefit from the strong structural expansion of India’s asset-management industry, driven by rising financialisation of household savings, deepening retail participation and supportive macroeconomic conditions. Mutual fund penetration remains relatively low, with India’s AUM-to-GDP ratio at 19.9% versus ~124% in the US, indicating significant headroom. Retail engagement continues to strengthen, supported by the surge in demat accounts and sustained SIP flows exceeding Rs250 billion monthly through FY25–H1FY26. Despite risks from market volatility, regulatory changes and intensifying digital competition, long-term fundamentals remain favourable. The industry’s projected 16–18% CAGR to FY30 positions ICICI AMC well for sustained growth.

ICICI Prudential AMC’s dominant market position, supported by strong equity capabilities and diversified reach, provides significant competitive advantage in a rapidly expanding industry. With a 13.3% share in active mutual fund QAAUM and leadership in equity-oriented schemes, the AMC benefits from higher fee yields and strong profitability, reflected in FY25 ROE of 82.8%. Its broad suite of 143 schemes across asset classes, extensive distribution network of 272 offices and over 1,10,000 MFDs, and a digital ecosystem handling 95% of purchases deliver meaningful scale benefits. These strengths, combined with disciplined investment processes and resilient fund performance, anchor multi-cycle sustainability.

ICICI AMC is positioned for multi-year value creation through its diversified platform spanning mutual funds, PMS, AIFs and offshore advisory mandates. Its Rs6,610 billion individual investor MAAUM and 15.5 million-strong retail base ensure sticky, long-tenor flows, with SIP contributions doubling to Rs 48 billion between March 2023 and September 2025. Expanding alternates-Rs 146.5 billion in AIF QAAUM and Rs 329.1 billion in offshore advisory-enhance mix quality and long-term revenue visibility. Industry-leading efficiency, with operating margins of 36–37 bps and exceptional ROE of 86.8% (annualised H1FY26), strengthens financial resilience. As the industry doubles by FY30, ICICI AMC remains structurally well-placed to compound earnings. At the upper end of the price band, the issue is valued at 40x FY25 EPS. We believe IPO is fully priced. We recommend a SUBSCRIBE rating to the issue for the long term.