New Delhi, Sept. 2 -- Listed asset management companies (AMCs) have been one of the standout performers in this year's trading sessions, propelled by record mutual fund inflows and expectations of a friendlier regulatory backdrop. However, analysts are sounding a note of caution, warning that the spectacular rally may start to slow as valuations stretch and competition within the industry intensifies.

In the past six months, AMC stocks have significantly outperformed broader financial indices. Shares of Nippon Life India AMC have soared 56%, HDFC AMC has gained 54%, UTI AMC is up 38%, and Aditya Birla AMC has rallied 36%, all compared with an 11.3% rise in the Nifty Financial Services Index.

However, the momentum seems to be cooling in ...