Indian Largecap IT Stocks Offer Relative Safety Amid Market Volatility

Nuvama Institutional Equities expects asset management companies and registrar and transfer agents to post a recovery in quarterly earnings driven by steady inflows and stable equity markets. The brokerage's top sector picks are HDFC AMC, Nippon Life India Asset Management, and KFin Technologies. SIP inflows climbed 4.4% MoM to ₹28,460 crore, while lump-sum inflows surged 5.8 times to ₹28,070 crore.

Title: Nuvama Institutional Equities Anticipates Recovery in Quarterly Earnings for AMCs and RTAs

Nuvama Institutional Equities has expressed optimism regarding the recovery in quarterly earnings for asset management companies (AMCs) and registrar and transfer agents (RTAs). The brokerage attributes this anticipated recovery to steady inflows and stable equity markets. According to Nuvama, July 2025 saw a significant increase in active equity net inflows, driven by robust systematic investment plan (SIP) and lump-sum contributions.

In July 2025, SIP inflows climbed 4.4% month-on-month (M-o-M) to ₹28,460 crore, while lump-sum inflows surged 5.8 times to ₹28,070 crore [1]. This surge in inflows is expected to support the earnings growth of key players in the AMC and RTA space, even amidst short-term market volatility. The brokerage's top sector picks are HDFC Asset Management Company (target price ₹6,530), Nippon Life India Asset Management (₹1,010), and KFin Technologies (₹1,540).

Nuvama analysts believe that the strong flow trend through SIPs and resilient market participation will bolster earnings growth for these key players. While the Nifty 50 index experienced a 2.9% M-o-M decline, the broader market's stability has not dampened the overall inflow trend. The industry has reported active equity inflows of ₹1.39 trillion for the financial year to date, down 10.1% year-on-year, with SIP and lump-sum inflows totaling ₹1.09 trillion and ₹30,050 crore, respectively.

By category, large- and mid-cap funds captured 21.8% of July’s active equity inflows, flexi-cap funds 13.5%, small-cap funds 11.5%, and thematic funds 16.7%. Despite the weak market performance, total active equity assets under management (AUM) remained stable at ₹41.3 trillion.

Passive funds (ETFs and index funds, excluding overseas fund-of-funds and gold) recorded net inflows of ₹8,260 crore in July. Debt and liquid schemes also registered strong inflows, with debt funds recording ₹13,910 crore and liquid schemes logging ₹92,790 crore.

The robust inflow trend, particularly through SIPs, coupled with resilient market participation, is expected to support earnings growth for key players in the AMC and RTA space, even amidst short-term market volatility.

References
[1] https://www.business-standard.com/markets/news/nuvama-upbeat-on-amc-rta-hdfc-amc-nippon-life-kfin-technologies-bse-sensex-nifty-today-markets-analysts-125081200129_1.html