Stocks To Buy: Asset manager shares surge 5% after Citi's 'double-upgrade'

Shares of Aditya Birla Sun Life Asset Management Company Ltd. gained nearly 5% on Friday, January 23, after brokerage firm Citi's double upgrade on the stock. The brokerage has also raised its price target on the asset manager by 18.4%.

Citi has double upgraded the stock to "buy" from "sell" and has raised its price target from ₹760 apiece to ₹900 per share, reflecting a potential upside of 16% from its previous close.

Citi said the AMC's performance had been tepid over the past few years, largely reflecting weakness in performance across key equity schemes.

Its market share in actively-managed equity-oriented monthly-average assets under management (MAAUM) declined to 4.2% by March 2025. The company's market share has bstarted to stabilise, in net equity flows / SIPs, over the past few quarters aided by improving and sustaining performance of key equity schemes in near-term buckets, Citi said.

The brokerage expects gross flows to pick up gradually as sustained performance in the one-year bucket translates to further revival in performance of higher order buckets.

Aditya Birla Sun Life AMC's management has indicated reduced redemption trends in key schemes and pick-up in net flows across a cohort of schemes, Citi said.

While the execution risks remain, Aditya Birla Sun Life's aggressive sales engine and sustained performance trends are likely to aid Average AUM accretion and market share accretion, Citi's note said, adding that this is key to the stock getting re-rated in the future.

Of the 16 analysts that have coverage on the stock 13 have a "buy" rating and three have a "hold" rating.

Shares of Aditya Birla Sun Life AMC are trading 5% higher on Friday at ₹812.5. Before today's trading session, the stock was up only 8% from its IPO price of ₹712.

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