Anand Rathi Reports Q1 Profit Surge of 71% to Rs 39 Crore, Excluding One-Time Charge.
Anand Rathi Share and Stock Brokers has demonstrated robust year-on-year growth in its financial performance for the June quarter, with a notable 71% increase in profit before exceptional items, reaching Rs 39.1 crore, up from Rs 22.8 crore in the previous year. This impressive growth can be attributed to strong gains in broking, margin funding, and distribution income. Revenue from operations surged by 22% to Rs 246.1 crore, while earnings before interest, tax, depreciation, and amortisation (EBITDA) also improved significantly, rising 30% to Rs 97.3 crore. The EBITDA margin expanded to 39.5%, reflecting enhanced operational efficiency.
A key contributor to this positive performance was the substantial growth in margin funding, with interest income from the margin trading facility soaring by 52% to Rs 42.8 crore. The margin trading facility (MTF) book increased by 55% year-on-year to Rs 1,331.8 crore, indicating heightened investor interest in leveraged equity exposure. Additionally, assets under management grew by 26% to Rs 9,479.1 crore, underpinning the company’s ability to generate recurring income. Distribution income rose 31% to Rs 27.5 crore, complementing a 15% increase in broking-related revenue to Rs 128 crore, which collectively reduced reliance on transaction-based income.
Despite these strong year-on-year metrics, the company’s sequential performance revealed signs of softening. Revenue declined 3.7% quarter-on-quarter, and EBITDA experienced an 11.8% decrease, resulting in a narrowed EBITDA margin of 39.5%, down from 43.2% in the previous quarter. The profit before exceptional items decreased by 6% on a sequential basis, while distribution income and other operating income fell by 22% and 16%, respectively. However, it is notable that broking revenue increased by 6.5% quarter-on-quarter, with stable interest income from margin funding mitigating some of the sequential declines.
Overall, Anand Rathi’s performance reflects strong year-on-year growth and fundamental shifts towards more stable revenue sources. The expanded non-broking revenue and reduced dependency on volatile transaction-based income suggest a strategic pivot that may provide resilience in fluctuating market conditions. Nonetheless, the sequential declines indicate the need for continued focus on optimizing operational efficiencies and revenue diversification to sustain growth moving forward.
Source: The Economic Times
(Expert Note: This report was prepared by the Wealthova team.)