The asset management company delivered a steady quarter, although it ceded some market share as equity assets under management (AUM) recovered at a slower pace due to mark-to-market changes.
SBI Funds Management retained its position as the country’s largest mutual fund house by average assets under management (QAAUM). Its QAAUM rose 0.8% sequentially to ₹12.61 lakh crore, slightly below the industry average, resulting in a market share decline of around 20 basis points.
Equity AUM increased 2% during the quarter, while systematic investment plan (SIP) inflows declined 2.4% compared with the previous quarter.
Revenue grew 1.3% quarter-on-quarter to ₹1,154 crore. The company also reported a slight improvement in yields, supported by a better product mix.
The improvement in yields eased concerns over potential pressure following the total expense ratio (TER) rationalisation. Management said it had successfully passed on the impact of the TER changes to distributors, leaving the company in a neutral to marginally positive position.
Operating profit remained largely flat on a sequential basis as higher employee costs weighed on profitability. Even so, operating margins remained robust at above 80%.
Net profit received a boost from mark-to-market gains, with other income swinging to a profit of ₹237 crore from a loss of ₹46 crore in the previous quarter.
Among key product categories, equity funds generated yields of 62 basis points, arbitrage funds 30 basis points, liquid funds 11 basis points, while gold and silver ETFs earned yields of 44-45 basis points.
The company also highlighted the growing contribution from smaller cities, with 65% of SIP inflows originating from B30 locations. Around 60% of its customers, as well as the majority of new customer additions, also came from these markets.
SBI Funds Management shares ended Monday’s session 0.17% lower at ₹588.15. The stock has declined about 4% so far this year.