ICICI Prudential AMC doesn’t really need a sales pitch. It’s one of the oldest names in India’s mutual fund industry, with roots going back more than three decades. The journey began in 1993, when the ICICI group entered a market that was still in its infancy. Back then, mutual funds were largely synonymous with one entity UTI which towered over the industry.
The real turning point came in 1998, when ICICI partnered with Prudential Plc, the UK-based insurance and asset management giant. That alliance gave birth to ICICI Prudential AMC as we know it today, with ICICI Bank holding the majority stake and Prudential owning the rest through its subsidiary. What started as a modest operation with just two branches and six employees has since grown into a nationwide network spanning over 270 locations and employing more than 3,500 people. Today, the company sits at the very top of the industry by active mutual fund QAAUM, managing over ₹1.01 lakh crore.
At its core, the business is straightforward. Investors entrust their savings to ICICI Prudential AMC through mutual funds and other investment products. The company’s job is to deploy that money across equities, debt, and other instruments in a way that balances risk and return. If markets rise and investors keep adding money, the asset pool grows and so do the company’s earnings.
Why the IPO Matters
ICICI Prudential AMC is now preparing to list on the stock exchanges with a ₹10,600 crore IPO. But this isn’t a typical fundraising exercise. The entire issue is an offer-for-sale, meaning no fresh capital flows into the company. Instead, Prudential Corporation Holdings is trimming its stake to about 39% post-listing.
In fact, even before the IPO, Prudential has already sold around 4.5% of its holding to ICICI Bank, lifting the bank’s stake to roughly 53%. Alongside ICICI Bank, the shareholder list already includes heavyweight names like the Abu Dhabi Investment Authority, family offices linked to Azim Premji and Rakesh Jhunjhunwala, and insurers such as SBI Life, HDFC Life, and Go Digit. Through the IPO, Prudential will offload another 10% to public investors.
So the obvious question is, if the company isn’t raising money, how should investors even evaluate this IPO?
The answer lies in the fundamentals. Since the business won’t use IPO proceeds to fund growth, the focus shifts entirely to how well the company is performing today and how sustainable that performance is over the long run.
How the Money Is Made
ICICI Prudential AMC runs a wide mix of products: equity funds, debt funds, hybrid schemes, index funds, ETFs, portfolio management services, and alternative investment funds. But the revenue engine is simple. The company earns management fees based on the total assets it manages. When markets rise or more investors come in, assets grow. And when assets grow, so do fees.
This model has worked well so far. Nearly 94% of the company’s operating revenue comes from fees and commissions. Between FY23 and FY25, its revenue jumped from ₹2,837 crore to ₹4,977 crore, translating into a healthy 32% CAGR. And this growth isn’t happening in isolation. The broader mutual fund industry itself is expanding rapidly. According to Crisil, industry-wide QAAUM is expected to grow at 16–18% annually over the next five years, reaching about ₹155 trillion by FY30.
This is especially relevant because mutual funds account for roughly 93% of ICICI Prudential AMC’s total average AUM. While the company doesn’t break down revenue by fund category in detail, industry trends are clear, equity-oriented funds typically earn higher fees than debt or passive products, and equity’s share of total AUM has been steadily rising.
Riding India’s Equity Wave
Over the past few years, equity-oriented schemes across the industry have grown their share of AUM from about 31% in FY21 to nearly 44% in FY25. They also continue to attract the strongest inflows, while debt funds have seen waning interest.
This shift reflects a broader transformation in Indian capital markets. Market capitalisation has surged, demat accounts are multiplying, IPO activity remains strong, and domestic institutional investors continue to pour money into equities. If this deepening trend persists, mutual fund assets should keep expanding and ICICI Prudential AMC stands to benefit directly.
That said, there is a structural challenge worth noting.
The Fee Pressure Question
Recent tax changes have made debt mutual funds less attractive by removing long-term capital gains benefits and indexation. As a result, long-term investors may prefer simpler alternatives like fixed deposits or other fixed-income products. At the same time, passive funds and ETFs which charge much lower fees are steadily gaining popularity.
This creates a subtle but important risk. Even if total assets continue growing, the average fee earned per rupee of AUM may come under pressure over time.
Where ICICI Prudential AMC Stands Out
Despite these headwinds, the company’s financial performance remains impressive. Net profit has grown at a 32% CAGR over the past two years, reaching ₹2,650 crore. Its operating margin, a critical metric for asset managers has stayed stable at 0.36% for three consecutive years.
To put that into context, HDFC AMC operates in a similar range, while other large peers like Nippon Life India and Aditya Birla Sun Life trail well behind. On profitability metrics, ICICI Prudential AMC is clearly among the industry leaders.
The strength becomes even more apparent when you look at return on equity. For FY25, the company delivered an RoE of around 83%, rising to nearly 87% on an annualised basis for the first half of FY26. Most listed AMCs operate with RoEs between 13% and 36%. This gap largely comes down to scale, managing more assets allows fixed costs to be spread thinner, boosting margins and profits.
Valuation and the Bigger Picture
Despite its strong position, the IPO pricing doesn’t look aggressive. At the upper end of the price band, the stock is valued at around 40 times earnings. That’s broadly in line with peers: HDFC AMC trades closer to 45 times, while Nippon Life India sits around 41 times.
So beyond the fact that this is an offer-for-sale and the usual uncertainty about future growth rates, there aren’t many glaring red flags. In a market that’s seen several richly priced IPOs backed by optimistic narratives, ICICI Prudential AMC stands out for its relative simplicity and consistency.
If the company continues managing investor money efficiently and translating asset growth into higher earnings per share, the story could age well.