Brokerage firm Prabhudas Lilladher has maintained its 'Buy' rating on ICICI Prudential AMC while lowering its price target to ₹3,420. The decision follows mixed Q2 FY27 results, where revenue rose 16.3% year-on-year, but sequential profits declined by 7.8%. Investors are weighing operational growth against challenges in maintaining market share in the popular small and mid-cap equity segments.
Prabhudas Lilladher has maintained its 'Buy' rating on ICICI Prudential Asset Management Company but revised its price target downward to ₹3,420 from the previous ₹3,550. This update follows a period of mixed performance for the asset manager, which recently reported its second-quarter earnings for fiscal year 2027.
In its latest quarterly results, ICICI Prudential AMC recorded revenue of ₹1,673.79 crore, representing a 16.3% increase compared to the same period last year. However, the company faced a sequential decline in profitability, with profit after tax falling 7.8% quarter-on-quarter to ₹888.96 crore. To reward shareholders, the company also declared an interim dividend of ₹30 per share, with October 21, 2026, set as the record date.
Market Share and Sector Trends
The brokerage’s decision to trim the target price is largely tied to changing investor preferences. While the core mutual fund business remains strong, the company has faced pressure on its equity market share, which recently stood at approximately 13.7%. The mutual fund industry is currently seeing a significant shift in capital, with a large portion of new investments moving toward small-cap and mid-cap funds. ICICI Prudential, which has historically held a strong position in large-cap and hybrid products, has faced challenges in capturing the same level of growth in the smaller-cap segments compared to some of its competitors.
Diverging Analyst Views
Market experts remain divided on the stock’s near-term prospects. While Prabhudas Lilladher continues to see value in the stock, it is not the only voice in the market. Jefferies has maintained a 'Buy' rating and raised its target price to ₹3,760, citing confidence in the company’s operational strength and product resilience. On the other hand, Kotak Institutional Equities has retained a 'Reduce' rating and lowered its price target to ₹3,200, pointing toward valuation concerns and the competitive pressure in the asset management space.
What Investors Should Track
The primary focus for investors in the coming quarters will be the company’s ability to regain equity market share and navigate the ongoing trend toward small and mid-cap assets. Additionally, the impact of market volatility on 'other income'—specifically regarding treasury holdings—remains a factor to watch. While the dividend provides a steady income cushion, the stock's valuation will likely depend on whether the company can adapt its product mix to better align with the current retail investor preference for higher-risk, high-growth equity categories.