Canara Robeco AMC shares rally 12% after listing. Should you buy, sell or hold the stock?

Core Insights - The IPO of Canara Robeco Asset Management Company raised Rs 1,326 crore, with a subscription rate of 25.9x from Qualified Institutional Buyers (QIBs), 6.45x from Non-Institutional Investors (NII), and 1.9x from retail investors [1][7] Company Performance - As of March 2025, the company reported total income of Rs 404 crore and a profit after tax (PAT) of Rs 191 crore, reflecting a year-on-year growth of 26% [6][8] - The company's EBITDA margin was 65.4%, one of the highest in the asset management sector, with a return on net worth (RoNW) of 36% [6][8] Market Position and Valuation - The upper price band of Rs 266 values the company at 19.6x its core EPS for September 2027, which is competitive compared to other asset management companies [5][8] - Canara Robeco is positioned to benefit from a positive outlook on Indian equities, with equities making up nearly 90% of its total assets, potentially leading to stronger core earnings [3][5] Analyst Recommendations - Domestic brokerage firm Prabhudas Lilladher has issued a Buy recommendation with a target price of Rs 320 per share, citing optimism about the company's business prospects and expected AAuM CAGR of around 20% over FY26-28E, which is 3% higher than the industry average [2][7] - Analysts suggest that investors should consider booking partial profits post-listing while holding the remaining shares for long-term growth, given the company's strong fundamentals and the mutual fund industry's expansion [7]