UTIAMC Q2 FY27 Earnings Call: Core PAT Jumps 31% YoY, SIF Launch Cleared

UTIAMC held its Q2 FY27 earnings call on October 23, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Core Earnings Grow Despite Flat Top Line; Reported PAT Diverges

• Standalone core income of Rs.324 Cr in Q2 FY 2026-2027 — up 2% YoY and 5% QoQ; standalone core PAT of Rs.136 Cr grew 31% YoY and 14% QoQ, outpacing revenue growth.
• Reported standalone PAT fell 14% YoY to Rs.143 Cr — and declined 34% QoQ, diverging sharply from core PAT growth.
• Consolidated core income of Rs.398 Cr (+2% YoY, +5% QoQ) — consolidated core PAT Rs.131 Cr (+22% YoY, +2% QoQ); consolidated reported PAT Rs.132 Cr (+17% YoY, −55% QoQ).
• H1 FY 2026-2027 standalone core income of Rs.632 Cr (+1% YoY) — core PAT Rs.253 Cr (+14% YoY); consolidated H1 core PAT Rs.263 Cr (+15% YoY), reported PAT Rs.426 Cr (+22% YoY).
• Quarterly average AUM rose to Rs.4.02 lakh Cr in Q2 FY 2026-2027 — from Rs.3.93 lakh Cr in Q1 FY 2026-2027; CFO Vinay Lakhotia quantified the ~Rs.10,000 Cr AUM growth, of which ~Rs.5,720 Cr came from net sales.
• Total group AUM of Rs.16.28 lakh Cr as of 30 Sep 2026 — market share at 4.61%; equity-oriented assets now 72% of average MF AUM vs ~70% in Q1 FY 2026-2027.

SIP Book Compounds Slowly; FlexiCap Outflows Weigh on Equity Flows

• Q2 FY 2026-2027 net sales of ~Rs.5,720 Cr — against elevated net outflows of close to Rs.800 Cr in equity and Rs.300 Cr in hybrid schemes, pressure attributed primarily to the FlexiCap fund.
• FlexiCap performance has improved significantly over the last three months — now in the first quartile; management expects progressively better inflows from FlexiCap and "blend strategy" funds (two now in the top half of quartiles) once performance stabilizes over a longer period.
• Combined monthly SIP+STP inflows of Rs.982 Cr in September 2026 — SIP AUM Rs.45,572 Cr as of 30 Sep 2026, broadly flat vs Rs.45,595 Cr in June 2026; gross SIP inflows Rs.2,583 Cr in Q2 FY 2026-2027 and Rs.5,085 Cr in H1 FY 2026-2027.
• 5.96 lakh new SIPs registered in Q2 FY 2026-2027 (87% digital-sourced) — market share of industry new SIP registrations by volume at 4.08%; average SIP ticket size ~Rs.3,100.
• SIP closure rate of ~70% in Q2 FY 2026-2027 vs industry trending at ~80% — management cited this as evidence its SIP book is better off than the broader industry, with a large part held by longer-tenure investors.
• Revenue yield flat at ~31 bps in Q2 FY 2026-2027 — segment yields: equity & hybrid ~73-74 bps, ETF & index funds ~8 bps, cash & arbitrage 11 bps, fixed income ~20-21 bps; marginal sequential movement attributed to commission repricing from SEBI's TER-to-VER regulation change, passed on to intermediaries.
• SIP concentration: FlexiCap is the largest SIP contributor at ~20.3% of inflows in Q2 FY 2026-2027 — vs ~19.3% in the year-ago period (FY 2025-2026); sectoral & thematic 16%, mid-cap 15%, large & mid-cap 12.7%.

Distributor Outreach Push; Redemptions Concentrated in Banks and National Distributors

• UTI operates 255 branches across the country whose sole task is sales — branch staff KRAs/KPIs are to reach out to distributors and partners, improve engagement, and address distributor requirements; significant effort has gone in over the last 1.5 years.
• "United" program launched for aggressive distributor outreach across the country — Sandeep Samsi's response to analyst feedback (via Vikas Kasturi, Focus Capital) that UTI Mutual Fund lags peers on distributor outreach; programs in FY 2026-2027 explained investment strategy and philosophy to invited distributors.
• Equity-side redemptions coming mainly from banks and national distributors — with some redemption pressure also from MFDs; Q2 FY 2026-2027 outflows came from multiple channels, with a smaller effect from MFDs and the direct channel.
• Top 30 cities contributed 80.30% of MF AUM in Q2 FY 2026-2027 — B30 at 19.7%; 10 new fintech partners onboarded, facilitating ~1 lakh transactions and contributing 67% of new investor acquisition in the quarter.
• Direct channel's challenge: investors using fintech platforms may lack guidance during periods of volatility — qualitative management observation, no figures attached.

SIF Launch Cleared; Alternatives AUM Up 52% YoY

• SEBI approval received for the specialized investment fund (SIF) initiative — the Classif Hybrid Long Short Fund launches in Q3 FY 2026-2027; regulators have allowed five or six SIF strategies, and management will assess demand before deciding over the next one or two years (FY 2027-2028 to FY 2028-2029) what products to launch.
• UTI Alternatives AUM ~Rs.4,045 Cr as of September 2026, up 52% YoY — from Rs.2,669 Cr in September 2025; SDOC 4 crossed Rs.1,000 Cr (AUM Rs.1,131 Cr; planned at Rs.1,500 Cr plus Rs.500 Cr green shoe; launched Q3 FY 2025-2026); first investment for the late-stage private equity fund signed.
• Q2 FY 2026-2027 launches: UTI Balanced Hybrid Fund plus four passive products — on Nifty 500 and BSE India Sector Leaders indices.
• Passive growth is bottom-line accretive despite yield dilution — management noted incremental passive revenue flows straight to the bottom line with no incremental cost; weighted average revenue yield dilution from faster passive growth has been observed over the last 2-3 years and is expected to continue (period unspecified).
• UTI Pension Fund AUM ~Rs.4.32 lakh Cr as of 30 Sep 2026, up ~10.97% YoY — from Rs.3.89 lakh Cr; manages ~24.01% of NPS industry AUM; 169 new corporates onboarded between April 2026 and October 2026.
• UTI International AUM of US$1.67 bn (~Rs.16,063 Cr) as of 30 Sep 2026 — clients across 30+ countries; revenue flattish sequentially amid weak macro; two new fund launches planned by end of Q3 FY 2026-2027 or Q4 FY 2026-2027, which management hopes should provide some traction; UTI Investments is actively exploring strategic partnerships with leading asset managers in East Asia and Latin America (no timeline given).

Employee Cost Guidance Held; 90-95% Payout Policy Reaffirmed Amid Cash Debate

• Employee cost guidance maintained for FY 2026-2027 — standalone at close to around Rs.95 Cr per quarter and consolidated at close to around Rs.130 Cr per quarter; employee and sales employee base declined in Q2 FY 2026-2027, though the CFO noted a few employees may be on the verge of joining.
• Board-level policy is to distribute ~90-95% of profits as dividend — CFO Vinay Lakhotia said this payout policy has been maintained over the last 3-4 years and will continue.
• No plans for a special dividend on incremental cash — management's rationale: UTI AMC is a standalone entity and this level of cash is required to continue operations, considering the size of industry growth and the company's own growth rate; individual investor Jagannatham argued cash reserves at ~45-50% of market cap (Q2 FY 2026-2027) should be returned if unproductive, noting management has said for two quarterly concalls it is evaluating M&A.
• Macro backdrop per management: RBI raised the repo rate to 5.50% in October 2026 — and projected FY27 GDP growth at 7.1%; Q1 FY27 GDP grew 7.8%; retail inflation rose to 5.54% in September 2026 amid West Asia tensions and crude oil volatility.
• Industry tailwinds: equity-oriented schemes attracted Rs.92,333 Cr in Q2 FY27 — H1 FY27 Rs.1.83 lakh Cr; record monthly SIP contribution of Rs.32,490 Cr in September 2026; industry quarterly average AUM rose to Rs.87.2 lakh Cr in Q2 FY27 from Rs.83.1 lakh Cr in Q1 FY27.

H2 FY27 Priorities and Mission 2031 Framework

• H2 FY27 priorities: improve participation in industry flows — strengthen the SIP franchise, deepen distribution productivity, maintain competitive investment capabilities, and build operating efficiency.
• Mission 2031 remains the guiding framework — five priorities: AUM growth, SIP franchise, distribution reach, digital capabilities, and investor outcomes.
• Management characterized SIP as a "slow gain process" — even doubling monthly SIP additions would not add very high numbers; strategy is to pursue both channels: SIP for run-rate growth and lump-sum inflows to boost AUM; new SIPs started only in Q2 FY 2026-2027 represent just 1/12th–1/24th of the total AUM the investor ultimately intends to deploy.
• Industry-wide moderation in small-cap and mid-cap flows observed amid market volatility — with flows returning to flexi-cap style, a trend seen in the last quarter; UTI's small-cap fund received 10.4% of pure equity SIP inflows in Q2 FY 2026-2027.
• Too early to comment on October (Q3 FY 2026-2027) industry flows — industry data is published only by the 8th-10th of the following month; management also lacked the non-SIP equity inflow split for small/mid-cap funds and offered to share offline.
• Investment performance as of September 2026: 51% of equity & hybrid funds in top two quartiles (3-month) — fixed income: 97% of AUM (incl. liquid funds) in top two quartiles over 3 months, 61% over 1 year; equity research coverage expanded to 480 companies in H1 FY27; 36 IPOs evaluated, 6 participated in.
• MD & CEO Vetri Subramaniam was absent from the call due to a personal emergency — CFO Vinay Lakhotia presented results for the quarter and half year ended 30 September 2026.