SBI Funds Management Share Price Target: Brokerage firms are bullish on SBI Funds Management share. A strong target has been set on this stock. Know 3 big triggers…
SBI Funds Management Share Price Today: The shares of SBI Funds Management Limited, the country’s largest asset management company, are making a big debut on the stock exchange (BSE & NSE) today. The company’s ₹9,813 crore IPO came in the market, which received an overwhelming response from investors and was subscribed a total of 41.66 times. But if you are thinking of exiting with just the listing gains or staying in the stock for the long term, then this new report from brokerage house Emkay Global may be useful for you.
What does the brokerage have to say about SBI Funds Management Share?
According to cnbctv18.com, just before the entry in the stock market, brokerage firm Emkay Global has given a ‘BUY’ rating while starting its coverage on the shares of SBI Funds Management. The brokerage has set a target price of ₹750 for the stock, which indicates a direct upside of 31% from its issue price (IPO price) of ₹574.
3 big triggers of brokerage
1. SBI Brand’s unmatched network and untapped customers
The brand of State Bank of India (SBI) and its distribution network is spread across the country. SBI Bank has about 2.1 crore (21 Million) salary account holders. In comparison, SBI Mutual Fund is currently serving only about 55 lakh (5.5 Million) customers. This means that SBI still has a huge scope to sell mutual funds among its own existing bank customers, especially in B-30 (outside the top 30 cities) and rural areas.
2. More focus on high-margin products
The company is constantly changing its asset mix. It is increasing the share of high yielding products like Equity Schemes, AIFs (Alternative Investment Funds) and PMS (Portfolio Management Services). This will strengthen the overall revenue yield of the company.
3. Scale advantage and 17% EBITDA growth
As the company’s business grows, the benefits of Operating Leverage will be seen. The brokerage estimates that the company’s EBITDA could grow at a CAGR (compound annual rate) of 17% between FY26 to FY29. According to Emkay Global, ‘As the savings and investment needs of Indians are changing, the middle class is adopting mutual funds as their core investment. SBI AMC has all the qualities to become the ‘Asset Manager for every Indian’, just as its parent company SBI has become the ‘Banker for every Indian’.
Which risks need to be kept in mind?
- If the market share of the company decreases in SBI’s own distribution network.
- The performance of mutual fund schemes remains poor for a long time.
- There is a prolonged recession in the stock market or any stringent regulatory change from SEBI.
Disclaimer: This article has been written for educational and informational purposes only. The brokerage report or target price information given in this is based on the views of the respective brokerage firm. Investing in stock market, IPO or mutual funds is subject to market risks. Before investing money in any share or taking any financial decision, please consult your registered financial advisor (SEBI Registered Financial Advisor). The platform or author will not be responsible for any damages.