Notes on Indian equities, sectors and economy

ICICI Pru & Reliance AMC Valuations

Posted by fairval on December 17, 2007

The above chart shows ICICI Prudential’s portfolio. It has around Rs 10,000 crore ($2.5bn) in equities, and another Rs 6000 crore or so in debt.

Most mutual funds in India dont have this kind of equit: debt. This comes from the fact that most private insurance companies in India are quasi-MFs. They largely sell ULIPs. For ICICI Pru over 80% of business is ULIPs.

Now ICICI Pru got a valuation of Rs 40,000 crore or more, when ICICI Holdings did a private placement.. So that is around 2.5x its AUM. But if 80% or more business is ULIP’s, is it really a life insurance co or a MF?

Reliance AMC recently got valued at Rs 10,000 crore, which was around 12% of AUM. That itself was high. Most AMCs get valued at 5-6% of AUM.

Clearly investors are willing to pay a lot premium for growth these days


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