Stock market today: Asset management company (AMC) stock has been witnessing huge buying interest in early morning deals on Friday session. AMC major HDFC AMC share price today opened with an upside gap and went on to hit 52-week high of ₹2,349.90 apiece levels on NSE whereas Aditya Birla Sun Life or ABSL logged over 7 per cent rise in opening bell today. Nippon Life share price has skyrocketed over 14 per cent in early morning deals on Friday.
According to stock market experts, this rise in AMC stock is mainly due to the outcome of recent SEBI (Securities and Exchange Board of India) board meeting in which proposed reduction in expense ratio has been deferred. This has sparked buying buzz among AMC stocks as market is expecting that profitability of the AMCs may remain stable in near term.
On reason for rise in AMC stocks today, Chandan Taparia, Derivative & Technical Analyst at Motilal Oswal said, “AMC stock are rising today after the recent SEBI board’s meeting outcome in which proposed reduction in expense ratio of the AMCs has been deferred. This has fueled buying interest among the Dalal Street bulls as they are expecting that the SEBI meeting outcome would enable AMCs to keep their profitability stable in near term.”
On this SEBI’s meeting would impact AMCs, Avinash Gorakshkar, Head of Research at Profitmart Securities said, “Expense ratio of the mutual funds are major income of AMCs. In the wake of non-reduction of expense ratio, profitability of the AMCs won’t go down, which is good for the balance sheet of AMCs. Therefore, market is expecting better quarterly numbers from the AMC in the wake of SEBI deferring reduction in expense ratio.”
However, both experts maintained that the SEBI’s meeting outcome will have near-term impact as SEBI would consider the proposal in upcoming meeting and in that case proposal to reduce expense ratio may get accepted.
Stocks to buy today
On AMC stocks that one can buy today, both experts recommended positional investors to look at HDFC AMC, SBI Life, ABSL and Nippon Life India Asset Management Ltd.
Capital market regulator SEBI has deferred its decision to rationalise Total Expense Ratio (TER), a charge that they levy on their investors. The market regulator said that SEBI will soon come with second consultation paper for rationalisation of the TER.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.
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Updated: 30 Jun 2023, 10:18 AM IST
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