On Wednesday, Nippon Life India Asset Management Ltd (NAM:IN) stock received a positive outlook from Nomura/Instinet, as the firm initiated coverage with a Buy rating and a price target of INR785.00. The financial institution highlighted several key factors contributing to their optimistic stance on the company.
According to the firm, NAM's consistent equity performance, notable market share gains, and a diverse range of products are pivotal elements driving the Buy recommendation. As the fourth largest asset manager in India, NAM is seen as being in a strong position to capitalize on increasing industry flows, particularly in the small and mid-cap segments.
Nomura/Instinet also underscored NAM's robust retail franchise and expanding market share in the Systematic Investment Plan (SIP) sector as reasons for the favorable rating. Furthermore, the firm's dividend payout policy, which exceeds 90%, was mentioned as a factor that could contribute to NAM's future financial success.
Looking forward, Nomura/Instinet projects a 21% compound annual growth rate (CAGR) for NAM's Assets Under Management (AUM) and a 21% core-earnings CAGR over the forecast period from the fiscal year 2024 to 2028. This projection underpins the firm's expectation of strong performance from NAM in the coming years.
The positive assessment from Nomura/Instinet comes as a vote of confidence in NAM's strategy and market position, suggesting that the asset management company is on a trajectory for sustained growth and profitability.
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