The much-anticipated SBI Funds Management listed at a slight premium to the issue price. Though the 7% listing premium was lower than what the GMP indicated, the big question now is whether it makes a case for investment now. Most experts that financialexpress.com spoke to see this AMC sector stock as long-term buy.
They are betting big on the growing potential across the mutual fund space and the cross-selling opportunity within the SBI ecosystem for the country’s largest AMC.
SBI Funds Management a ‘long-term’ Buy
Listing out the key reasons driving their positive view, Manish Sonthalia, Director and CIO of Emkay Investment Managers elaborated on the key factors supporting the stock going forward: “We think SBI AMC is a long-term buy because SBI AMC is well positioned to capitalise on the structural growth of the Indian mutual fund industry, backed by SBI’s unmatched brand, trust, and nationwide distribution network, particularly in B-30 cities and rural India, where mutual fund penetration remains low.”
He highlighted “the massive cross-selling opportunity within SBI ecosystem.”Despite SBI having 21 million salary account holders and over 350 million savings accounts, “only 5.5 million customers currently invest through SBI Mutual Fund, providing a significant long-term runway for customer acquisition and AUM growth,” he added
The company is steadily increasing the share of higher-yielding equity, AIF and PMS, which should support stable revenue yields and stronger profitability despite industry competition. He believes that growth is supported by improving asset mix and “is expected to deliver 17% CAGR in AUM and EBITDA during FY26–FY29, with expanding operating margins driven by scale benefits and improving business mix, making SBI AMC one of the highest-quality asset management franchises in India.”
Expect to see more buying
The SBI Funds management share price has been steady on day 1. Market veteran Ambareesh Baliga believes that though the “listing gains were lower than expected, one could see buying coming in.SBI AMC has a market share of 15%+ and along with this the AMC’s dual parentage creates a unique competitive advantage that distinguishes it from both standalone domestic asset managers and other bank-affiliated AMCs in India.”
SBI Funds Management may rally 10%
Equirus has assigned a Buy rating on SBI Funds Management with a target of Rs 675 per share. They see the stock well poised to capitalise on India’s financialisation opportunity; its equity QAAUM grew at 33% CAGR over FY21-Jun 2026, with market share rising to 12.7% from 10.2%.
Lalit Deo, AVP Research – Equities, Equirus Securities, pointed out that “SBI AMC’s asset-light business model has delivered strong operating leverage, with revenue growing at a steady rate. SBI AMC is one of the strongest franchises in the AMC industry and is well positioned to benefit from industry tailwinds. We have initiated coverage with ‘Long’. The key risks include adverse market trends, scheme underperformance and regulatory risks.”
SBI Funds Management: See re-rating potential
Sameer Sawant, Research Analyst at Mirae Asset Sharekhan too highlighted the log-term growth opportunity.
“SBI Funds Management sets the stage for long-term growth. The 9% gain on debut is broadly in line with our expectation of moderate listing gains and reflects a fair start for an issue that priced conservatively relative to peers even at 38.1x FY26 P/E. With a dominant 15.3% QAAUM market share, industry-leading cost efficiency, and a 51% ROE, we believe the stock’s re-rating potential lies ahead, driven by structural tailwinds in the financialisation of savings and SIP penetration. We maintain our constructive long-term view on the stock.”
Strong buy for a 3- to 5-year investment horizon
Uday Patil, Executive Director, PL Capital also reiterated the return potential over the long-term, “SBI Fund’s listing has been constructive, though not spectacular. However, if one has 3-5 years horizon, SBI Funds remains one of the strongest businesses in Indian AMC space because of its scale, brand and expected growth in the mutual fund industry.”
Conclusion
Most market experts see SBI Funds Management as a ‘Buy’ over the long term. The AMC stock is expected to benefit frm India’s financialisation opportunity. Its equity QAAUM grew at 33% annually on a compounded basis over FY21-Jun’26, with market share rising to 12.7% from 10.2%.
SBI’s unmatched distribution network of 23,000+ branches and 100 million+ YONO users is also seen as a major booster to help future growth prospects.