HDFC AMC gets ₹167 crore from Essel group

Shares of HDFC AMC today gained as much as 3% after the asset management company said that it has received repayment of ₹167 crore from Essel group. HDFC AMC holds certain NCDs of the Essel Group that are secured by a pledge of listed equity shares. "The carrying value of these NCDs as at September 30, 2019 was ₹275.6 crore. The company has received total of ₹167 crore towards part repayment of the said NCDs and interest thereon, from the issuer through sale of certain listed equity shares comprising part of the collateral. The value of the residual pledged listed equity shares as at November 25, 2019 is ₹143.9 crore," HDFC AMC said. Further, the world's biggest index compiler MSCI had announced earlier this month that HDFC AMC would be included in its India index.In late trade, HDFC AMC shares were up 1.5% to ₹3,645. HDFC AMC shares have more than doubled in price from the start of this year, hitting a new high of ₹3,844 earlier this month. "The Indian mutual fund industry has several structural factors in place which will lead to its multi-year growth. The Indian MF industry AUM as a share of GDP (11%) remains significantly lower than the world average (62%). While Indian household savings as a percentage of GDP have declined over the recent past, RBI data indicate that households are moving higher shares of their savings to financial assets," Centrum Institutional Research had said in November 2 note. "This provides scope for strong future industry AUM growth. Significant recent regulatory changes such as revised expense ratios will lower costs for mutual fund investors and should aid in greater retail participation. Furthermore, industry Systematic Investment Plan (SIP) flows have seen high growth over the last five years and should be a strong driver for MF AUM growth," it added.HDFC Asset Management Company (AMC) reported a 79% jump in profit after tax at ₹368.3 crore in the three months ended September 30, 2019.


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