ANANDRATHI - Anand Rathi Wea.

📊 NSE: ANANDRATHI 🏢 Finance & Investments 📅 Last Updated: 12/13/2025 18:18

💰 Financial Performance

Revenue Growth by Segment

Consolidated total revenue for H1 FY26 grew 19.5% YoY to INR 591.4 Cr. The Mutual Fund (Equity & Debt) segment grew 21.2% YoY to INR 236.0 Cr in H1 FY26. Q2 FY26 total revenue was INR 307.2 Cr, up 23.1% YoY from INR 249.6 Cr.

Geographic Revenue Split

The company operates in 18 Indian cities including Mumbai, Delhi, Bengaluru, and Chennai. A wholly-owned subsidiary, Anand Rathi Wealth UK Limited, was incorporated in London in February 2025 but has not yet commenced business operations as of late 2025.

Profitability Margins

Net Profit After Tax (PAT) margin improved from 30.2% in H1 FY25 to 32.8% in H1 FY26. Q2 FY26 PAT margin was 32.5%, up from 30.6% YoY. This improvement is driven by operational efficiencies and growth in high-yield equity mutual fund inflows.

EBITDA Margin

The company maintains a high PBT margin of approximately 46%, though management intends to reinvest a portion of this into technology and HR to sustain a long-term growth rate of 20-25%.

Capital Expenditure

The company infused GBP 499,900 (approx. INR 5.3 Cr) into its UK subsidiary in November 2025 to fund global expansion. Historical CAGR for AUM from Mar-19 to Mar-25 was 27%, reaching INR 77,103 Cr.

Credit Rating & Borrowing

Not disclosed in available documents. However, the company's NBFC arm maintains a secured portfolio with 60-65% in government securities and AAA bonds, with a net NPA of 0.4%.

⚙️ Operational Drivers

Raw Materials

Not applicable (Service Industry). The primary operational resources are Human Capital (Relationship Managers) and Technology.

Import Sources

Not applicable (Service Industry).

Key Suppliers

The company distributes products from various Asset Management Companies (AMCs) and financial institutions, acting as a distributor rather than a manufacturer.

Capacity Expansion

Current Assets Under Management (AUM) stood at INR 91,568 Cr as of H1 FY26, representing 92% of the FY26 guidance of INR 1,00,000 Cr. The company is expanding its 'capacity' by hiring Relationship Managers and expanding into the UK market.

Raw Material Costs

Employee Benefit Expenses are the primary operational cost, amounting to INR 109.4 Cr in Q2 FY25. These costs are critical as the business model relies on Relationship Managers to drive AUM growth.

Manufacturing Efficiency

AUM per Relationship Manager (RM) and Clients per RM are the key efficiency metrics used to track operational productivity.

Logistics & Distribution

Distribution is handled through 18 physical locations in India and a growing digital presence via the 'Uncomplicated' app.

📈 Strategic Growth

Expected Growth Rate

20-25%

Growth Strategy

Growth is driven by 'four engines': delivering superior risk-adjusted performance to clients (implied growth), maintaining low client attrition (one decimal point), acquiring new client families, and increasing market share in net inflows (2.33% in H1FY26).

Products & Services

Private wealth management, Equity Mutual Funds, Structured Products (SP), Debt Mutual Funds, and NBFC lending services.

Brand Portfolio

Anand Rathi Wealth, AR Digital Wealth, Uncomplicated by ARWL (App).

New Products/Services

Beta testing of the 'Uncomplicated by ARWL' app to strengthen digital delivery. Expected to enhance client engagement and RM productivity.

Market Expansion

Expansion into the European market via the London-based UK subsidiary, which received FCA authorization on December 4, 2025.

Market Share & Ranking

Market share in Equity Mutual Fund net inflows increased to 2.33% in H1 FY26 from 1.85% in FY25.

🌍 External Factors

Industry Trends

The industry is seeing a shift toward professional wealth management and financialization of savings, evidenced by SIP inflows growing 37.9% YoY to INR 80 Cr in September 2025.

Competitive Landscape

Competes with private banks, boutique wealth managers, and digital-first robo-advisors.

Competitive Moat

Moat is built on an 'uncomplicated' wealth model and high client retention, resulting in a high ROE of 45.5%. This relationship-based model creates high switching costs for HNI clients.

Macro Economic Sensitivity

Highly sensitive to Indian equity market cycles; a 10% market correction would theoretically reduce AUM-linked revenue by a similar magnitude.

Consumer Behavior

Increasing preference for risk-adjusted returns and structured products, which now comprise 27% of the company's AUM mix.

Geopolitical Risks

UK expansion introduces regulatory risks associated with the Financial Conduct Authority (FCA) and European financial market volatility.

⚖️ Regulatory & Governance

Industry Regulations

Compliance with SEBI (LODR) Regulations 2015 and the Companies Act 2013. UK operations are regulated by the Financial Conduct Authority (FCA).

Environmental Compliance

The company publishes a Business Responsibility and Sustainability Report (BRSR) in compliance with SEBI mandates.

Taxation Policy Impact

Effective tax rate is approximately 25-26% based on H1 FY26 PAT of INR 194 Cr and PBT figures.

Legal Contingencies

The company has certified compliance with all corporate governance conditions; no specific high-value pending court cases were disclosed in the provided text.