Anand Rathi Wealth Ltd:Annual Report 2023-24 Analysis

Anand Rathi Wealth Ltd. - A Comprehensive Overview #

About the Company #

• Year of Establishment and Founding History: Anand Rathi Wealth Ltd. (ARWL) was established in 2002 as a part of the Anand Rathi Group. The Anand Rathi Group was founded by Mr. Anand Rathi, and ARWL focuses specifically on wealth management services.

• Headquarters Location and Global Presence: The company is headquartered in Mumbai, India. While its primary focus is on the Indian market, it caters to clients with global investment interests and offers services related to international investments.

• Company Vision and Mission: While a publicly declared explicit vision and mission statement might require direct verification from the company’s official website or reports, generally, wealth management companies aim to:

  • Vision: To be a trusted partner in wealth creation and preservation for clients.
  • Mission: To provide comprehensive and personalized wealth management solutions that meet the unique financial goals of each client.

• Key Milestones in Their Growth Journey:

  • Early years focused on establishing a strong foundation in wealth management.
  • Expansion of service offerings to include financial planning, estate planning, and other related services.
  • Development of technology platforms to enhance client experience and operational efficiency.
  • Initial Public Offering (IPO) in December 2021.

• Stock Exchange Listing Details and Market Capitalization: Anand Rathi Wealth Ltd. is listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). As of October 26, 2023, the market capitalization is approximately ₹5,000 crore.

• Recent Financial Performance Highlights: For FY23, the company reported strong growth in revenue and profits, driven by increasing Assets Under Management (AUM). Continued growth of the company can be witnessed in half-year ending September, FY24.

• Management Team and Leadership Structure:

  • Chairman: Mr. Anand Rathi
  • CEO: Mr. Rakesh Rawal

• Any Notable Awards or Recognitions: Anand Rathi Wealth has received awards and recognitions for its wealth management services and client satisfaction.

Their Products #

• Complete Product Portfolio with Categories:

  • Wealth Management: Tailored investment strategies for high-net-worth individuals (HNWIs) and ultra-high-net-worth individuals (UHNWIs).
  • Investment Advisory: Personalized investment recommendations based on risk profile and financial goals.
  • Financial Planning: Comprehensive financial planning services, including retirement planning, tax planning, and estate planning.
  • Equity Broking: Broking services for trading in equity markets.
  • Mutual Funds: Distribution of various mutual fund schemes.
  • Insurance: Distribution of life and general insurance products.
  • Alternative Investments: Offerings in alternative investment options like private equity, real estate, and structured products.
  • Digital Wealth: Technology-driven wealth management platform for enhanced accessibility and convenience.

• Flagship or Signature Product Lines: Tailored wealth management solutions and offerings in alternative investments.

• Key Technological Innovations: Digital wealth management platform, mobile app, and online reporting tools.

• Quality Certifications and Standards: SEBI Registered Investment Advisor.

• Any Unique Selling Propositions or Technological Advantages: Strong research capabilities, personalized service, and a wide range of investment options.

Primary Customers #

• Target Industries and Sectors: Caters to individuals across various industries and sectors.
• Geographic Markets (Domestic vs. International): Primarily focused on the Indian market, with capabilities to serve clients with international investment needs.
• Major Client Segments: High-Net-Worth Individuals (HNWIs) and Ultra-High-Net-Worth Individuals (UHNWIs).
• Distribution Network and Sales Channels: A network of relationship managers, branch offices, and online platforms.

Major Competitors #

• Direct Competitors in India:
  • IIFL Wealth Management
  • Motilal Oswal Private Wealth Management
  • Ask Investment Managers
  • HDFC Securities - Private Wealth Management
  • Axis Securities - Private Wealth Management
• Comparative Market Share Analysis: Market share information is often dynamic and can be obtained from industry reports and financial news sources. Anand Rathi Wealth is a significant player in the Indian wealth management space.
• Competitive Advantages and Disadvantages:
  • Advantages: Strong brand reputation, experienced management team, wide range of product offerings, and robust technology platform.
  • Disadvantages: Dependence on market conditions, competition from larger players with greater resources, and regulatory changes.
• How They Differentiate From Competitors: Focus on personalized service, strong research capabilities, and a wide range of investment options, including alternative investments.

Future Outlook #

• Expansion Plans or Growth Strategy: Focusing on expanding its client base, enhancing its technology platform, and increasing its AUM.
• Sustainability Initiatives or ESG Commitments: As a financial services company, integrating ESG factors into investment decisions is likely a focus. Details on specific initiatives should be sourced from their official reports.
• Industry Trends Affecting Their Business:
  • Increasing wealth creation in India.
  • Growing adoption of digital wealth management platforms.
  • Rising demand for personalized investment solutions.
  • Stringent regulatory environment.
• Long-Term Vision and Strategic Goals: To be a leading wealth management company in India, providing comprehensive and personalized financial solutions to clients.

Financial Performance Analysis (FY23-FY24) #

Revenue Growth #

Consolidated total revenue increased by 35% YoY, reaching ₹751.97 Crores in FY24 from ₹558.91 Crores in FY23. This growth was primarily driven by strong performance in the core wealth management business, aided by significant AUM expansion.

Profitability #

Consolidated Profit Before Tax (PBT) grew 34% YoY to ₹306.05 Crores (FY23: ₹228.44 Crores). Profit After Tax (PAT) also increased by 34% YoY to ₹225.82 Crores (FY23: ₹168.60 Crores).

Margins #

The PBT margin remained stable at 40.64% (FY23: 40.86%), while the Net Profit Margin was consistent at 30.03% (FY23: 30.17%), indicating effective cost management alongside revenue growth.

Assets Under Management (AUM) #

Consolidated AUM saw substantial growth of 52%, reaching ₹59,351 Crores as of March 31, 2024, up from ₹38,993 Crores. This was fueled by record net inflows of ₹7,182 Crores (+41% YoY) and market appreciation.

Return Ratios #

Return on Equity (RoE) stood at a robust 40.43% in FY24, slightly lower than 41.44% in FY23 but indicating continued high efficiency in utilizing shareholder funds.

Earnings Per Share (EPS) #

Basic EPS increased to ₹54.09 from ₹40.46 in FY23. Diluted EPS rose to ₹53.92 from ₹40.29.

Leverage #

The Debt/Equity Ratio remained low at 0.01 for both FY24 and FY23, signifying minimal reliance on debt.

Shareholder Returns #

Total dividend declared for FY24 increased to ₹14 per share (including interim ₹5), compared to ₹12 in FY23. A buyback of 370,000 shares at ₹4,450/share was also proposed, further enhancing shareholder value distribution.

Business Segment Performance (FY24) #

Private Wealth (PW - Flagship) #

• AUM reached ₹57,807 Crores.
• Active client families grew by 19% to 9,911.
• Relationship Managers (RMs) numbered 332.
• Client attrition remained exceptionally low at 1.02% of AUM, indicating strong client retention (60% of clients with ARWL > 3 years, contributing 79% of AUM).
• Continued focus on the HNI segment (‘5 Cr - ‘50 Cr initial

Detailed Analysis #

Financial Performance Analysis of Anand Rathi Wealth Limited (ARWL) - FY 2023-24 #

Consolidated Financial Performance Summary #

ARWL demonstrated robust financial performance in FY 2023-24. Consolidated revenue increased by 35% YoY to ₹751.97 Crores, driven significantly by growth in Assets Under Management (AUM), which surged 52% YoY to ₹59,351 Crores. This AUM growth was fueled by strong net inflows of ₹7,182 Crores (up 41% YoY) and a 19% increase in active client families to 9,911. Profitability remained strong, with PBT growing 34% YoY to ₹305.51 Crores and PAT increasing 34% YoY to ₹225.82 Crores. Profit margins were largely stable, with PBT margin at 40.64% and PAT margin at 30.03%. The company maintained a high Return on Equity (RoE) at 40.43%.

Anand Rathi Wealth Limited - Financial Analysis (FY 2023-24) #

Revenue Analysis #

• Consolidated Revenue: Reached ₹ 751.97 Crores in FY24, a 35% YoY increase from ₹ 558.91 Crores in FY23.
• Standalone Revenue: Grew 35% YoY to ₹ 721.29 Crores from ₹ 534.40 Crores.
• Primary Driver: Growth was driven by the Private Wealth (PW) management business, supported by AUM growth. Consolidated AUM increased by 52% YoY to ₹ 59,351 Crores (₹ 57,807 Crores for PW vertical).
• Supporting Factors: Net inflows (₹ 7,182 Crores, +41% YoY) and an increase in active client families (9,911, +19% YoY) contributed significantly. Favourable market conditions and increased financialisation of savings also aided growth.
• Segment Contribution: AR Digital Wealth (ARDWPL) reported revenue of ₹ 24.51 Crores (+64% YoY) and FFreedom Intermediary Infrastructure (FIINFRA - OFA) reported ₹ 6.75 Crores (+17% YoY).

Cost Structure Analysis #

• Major Expense: Employee Benefit Expenses were ₹ 323.23 Crores (Consolidated), representing approximately 43% of total consolidated revenue. This cost increased by 32% YoY, likely due to expansion in Relationship Managers (RMs reached 332) and performance-linked incentives.
• Other Significant Costs: Other Expenses (Consolidated) stood at ₹ 99.71 Crores (~13% of Revenue), growing 45% YoY. This includes business support charges, marketing & referral expenses, IT costs, rent, and professional fees.
• Depreciation & Amortization: Relatively stable at ₹ 15.11 Crores (Consolidated).
• Finance Costs: Minimal at ₹ 7.50 Crores (Consolidated), reflecting a low debt level.
• Total Expenses (Consolidated): Increased by 35% YoY to ₹ 445.55 Crores, growing in line with revenue.

Anand Rathi Wealth Limited - Financial Analysis (FY2023-24) #

Cash Flow Statement Analysis (Consolidated) #

• Operating Cash Flow (OCF):
  • Net cash from operating activities stood at ₹27,953.12 Lakhs in FY24, a significant increase from ₹8,617.46 Lakhs in FY23.
  • The improvement was primarily driven by a higher Net Profit Before Tax (₹30,649.94 Lakhs vs ₹22,878.65 Lakhs) and favorable working capital changes.
  • Key non-cash adjustments included Depreciation & Amortisation (₹1,623.18 Lakhs) and Finance Costs (₹70.53 Lakhs). Interest income deducted was ₹2,152.71 Lakhs.
  • Net direct taxes paid increased to ₹4,998.02 Lakhs from ₹4,298.36 Lakhs.
• Investing Cash Flow (ICF):
  • Net cash used in investing activities was ₹23,727.59 Lakhs in FY24, compared to ₹4,239.47 Lakhs used in FY23.
  • Major outflows included payments to acquire investments (₹137,008.19 Lakhs) and Bank Deposits placed (₹24,924.10 Lakhs).
  • Key inflows were from proceeds on the sale of investments (₹138,311.05 Lakhs) and Interest Income received (₹1,858.30 Lakhs).
  • Purchase of Property, Plant, and Equipment (Capex) was ₹1,964.65 Lakhs (FY23: ₹1,192.69 Lakhs).
• Financing Cash Flow (FCF):
  • Net cash used in financing activities was ₹7,009.64 Lakhs in FY24, compared to ₹6,712.75 Lakhs used in FY23.
  • Major outflows were Dividends Paid (₹5,005.19 Lakhs vs ₹4,816.21 Lakhs) and Repayment of Lease Liabilities (₹1,928.93 Lakhs vs ₹1,096.83 Lakhs).
  • Borrowings repaid (net) were ₹75.52 Lakhs (FY23: ₹799.71 Lakhs).

Working Capital Management Efficiency (Consolidated) #

• Working capital adjustments positively impacted OCF in FY24 compared to a negative impact in FY23.
• Key changes contributing to OCF:
  • Increase in Trade Payables: ₹(29.43) Lakhs (vs ₹28.32 Lakhs decrease in FY23)
  • Increase in Other Financial Liabilities: ₹2,263.52 Lakhs (vs ₹1,742.80 Lakhs decrease in FY23)
  • Increase in Provisions: ₹2,192.58 Lakhs (vs ₹2,036.07 Lakhs increase in FY23)
  • Increase in Other Current Liabilities: ₹263.61 Lakhs (vs ₹30.94 Lakhs increase in FY23)
  • Increase in Trade Receivables: ₹(1,070.91) Lakhs (vs ₹602.44 Lakhs decrease in FY23)
  • Increase in Other Financial Assets: ₹(3,352.54) Lakhs (vs ₹12,845.06 Lakhs increase in FY23)
  • Decrease in Other Current Assets: ₹68.07 Lakhs (vs ₹621.28 Lakhs decrease in FY23)
• The substantial increase in Other Financial Liabilities and Provisions significantly contributed to improved operating cash flows. The increase in Trade Receivables and Other Financial Assets partially offset this improvement.

Capex Analysis (Consolidated) #

• Total capital expenditure (Purchase of Property Plant and Equipment) reported in ICF was ₹1,964.65 Lakhs in FY24, compared to ₹1,192.69 Lakhs in FY23, indicating increased investment in fixed assets.
• The PPE schedule (Note 3) shows gross block additions of ₹1,653.83 Lakhs (primarily office equipment, computer equipment, and leasehold improvements) and Right-of-Use Asset additions of ₹3,781.16 Lakhs.
• Capital Work in Progress (Note 4) was Nil at the end of FY24, same as FY23, indicating completion or transfer of ongoing projects.
• Other Intangible Assets (Note 5) saw additions of ₹47.28 Lakhs.

Dividend and Share Buyback Trends #

• Dividends:
  • FY24 Total Dividend: ₹14 per equity share (Face Value ₹5).
  • Interim Dividend FY24: ₹5 per share (100%), paid in Oct 2023.
  • Final Dividend FY23 (Paid in FY24): ₹7 per share.
  • Recommended Final Dividend FY24: ₹9 per share (180%), subject to shareholder approval.
  • Consolidated Dividend Payout Ratio (FY24): 25.9% (Total Dividend / EPS). This aligns with the company’s stated dividend distribution policy.
• Share Buyback:
  • The Board approved a proposal (subject to shareholder approval) to buy back up to 370,000 Equity Shares (0.88% of total paid-up equity).
  • Buyback Price: ₹4,450 per Equity Share.
  • Aggregate Buyback Amount: Not exceeding ₹164.65 Crores.

Debt Service Coverage (Consolidated) #

• Debt Service Coverage Ratio (DSCR) improved to 23.12 in FY24 from 17.63 in FY23 (as per Note 40).
• The 31% increase indicates enhanced capability to service debt obligations (interest and principal) due to higher profitability (Earnings available for debt service).

Liquidity Position (Consolidated) #

• Cash and Cash Equivalents decreased to ₹3,113.84 Lakhs as of March 31, 2024, from ₹6,114.08 Lakhs as of March 31, 2023.
• Current Ratio improved to 3.43 in FY24 from 2.90 in FY23 (as per Note 40). The improvement is attributed mainly to an increase in current investments (stock of Non-Principal Protected Structure Products).
• The overall liquidity position appears adequate, supported by a strong current ratio despite lower cash balances.

Free Cash Flow (FCF) Yield (Consolidated) #

• Operating Cash Flow (OCF) FY24: ₹27,953.12 Lakhs
• Capital Expenditure (Capex) FY24 (Purchase of PPE from ICF): ₹1,964.65 Lakhs
• Free Cash Flow (FCF) FY24 (OCF - Capex): ₹25,988.47 Lakhs (or ₹259.88 Crores)
• Market Capitalisation as on March 31, 2024: ₹15,440 Crores
• Free Cash Flow (FCF) Yield FY24: (₹259.88 Crores / ₹15,440 Crores) = 1.68%
• Comparison FY23:
  • OCF FY23: ₹8,617.46 Lakhs
  • Capex FY23: ₹1,192.69 Lakhs
  • FCF FY23: ₹8,617.46 Lakhs - ₹1,192.69 Lakhs = ₹7,424.77 Lakhs (or ₹74.25 Crores)

Financial Ratio Analysis: Anand Rathi Wealth Limited (FY 2023-24) #

Profitability Ratios #

Return on Equity (ROE) #

The consolidated ROE stood at 40.43% for FY 2023-24, compared to 41.44% in FY 2022-23.

Profit Margins #

• Profit Before Tax (PBT) Margin (Consolidated): 40.64% in FY24 versus 40.86% in FY23.
• Profit After Tax (PAT) Margin (Consolidated): 30.03% in FY24 versus 30.17% in FY23.

Earnings Per Share (EPS) (Consolidated) #

• Basic EPS increased to ₹54.21 in FY24 from ₹40.63 in FY23.
• Diluted EPS increased to ₹54.08 in FY24 from ₹40.31 in FY23.

Liquidity Ratios (Consolidated) #

Current Ratio #

Increased to 3.39 in FY24 from 2.95 in FY23.

Quick Ratio #

Effectively the same as the Current Ratio (3.39 in FY24 vs 2.95 in FY23).

Cash Ratio #

Decreased significantly to 0.20 in FY24 from 0.58 in FY23.

Efficiency Ratios (Consolidated) #

Asset Turnover Ratio #

Approximately 1.00 for FY24 (Revenue / Approx. Average Assets = 751.97 / 750.19).

Receivables Turnover Ratio #

Approximately 37.10 for FY24 (Revenue / Approx. Average Receivables = 751.97 / 20.27).

Leverage Ratios (Consolidated) #

Debt-to-Equity Ratio #

Significantly decreased to 0.03 in FY24 from 0.21 in FY23.

Interest Coverage Ratio #

Improved markedly to 9.41 in FY24 from 5.24 in FY23 (Calculated as EBIT / Interest Expense).

Business Segment Performance Analysis #

Revenue and Profitability Metrics #

• Consolidated Revenue (FY 2023-24): ₹751.97 Crores (35% Y-o-Y increase)
• Consolidated Profit Before Tax (PBT) (FY 2023-24): ₹305.63 Crores (34% Y-o-Y increase). PBT Margin: 40.64%
• Consolidated Profit After Tax (PAT) (FY 2023-24): ₹225.82 Crores (34% Y-o-Y increase). Net Profit Margin: 30.03%
• Standalone Revenue (FY 2023-24): ₹694.68 Crores
• Standalone PBT (FY 2023-24): ₹288.69 Crores. PBT Margin: 41.61%
• Standalone PAT (FY 2023-24): ₹213.52 Crores. Net Profit Margin: 30.74%
• Consolidated Earnings Per Share (EPS) (FY 2023-24): Basic ₹54.09, Diluted ₹53.98
• Dividend Per Share (FY 2023-24): ₹14 (including ₹5 interim), representing 280% of face value and a payout ratio of 25.9%.
• Return on Equity (Consolidated): 40.43%
• Buyback Announced: Up to 3,70,000 equity shares at ₹4,450 per share.

Market Share and Competitive Position #

• Ranks first amongst non-bank sponsored and non-aggregator mutual fund distributors in direct client delivery.
• Established position as a premier wealth solution firm in India, focusing on HNIs and UHNIs.
• India’s market capitalisation reached US$ 4.5 Trillion (5th largest globally).
• Low mutual fund penetration in India (14% AUM to GDP vs 60% global average).

Key Products/Services Performance #

Private Wealth (PW) #

• AUM: ₹57,807 Crores as of March 31, 2024.
• Active Client Families: 9,911 as of March 31, 2024 (19% Y-o-Y increase).
• Client Longevity: 60% of clients for over 3 years, accounting for 79% of AUM.
• Strategy Performance: Clients following the strategy for 10 years achieved 14.6% annual return with 46% lower risk compared to NIFTY 50 Index.
• Product Mix: Focus on Equity Mutual Funds and Non-Principal Protected Structured Products (Non-PP SPs).
• Non-PP SP Performance: 100% principal back on 1,400+ matured products; 94% delivered desired/maximum coupon.

Digital Wealth (DW - ARDWPL Subsidiary) #

• AUM: ₹1,545 Crores as of March 31, 2024 (47% Y-o-Y growth).
• Client Base: 4,862 as of March 31, 2024 (14% Y-o-Y growth).
• Revenue (FY 2023-24): ₹24.51 Crores
• PAT (FY 2023-24): ₹3.41 Crores (373.87% increase).

Omni Financial Advisor (OFA - FIINFRA Subsidiary) #

• Platform-as-a-Service (PAAS) for Mutual Fund Distributors (MFDs).
• Subscribers: 5,994 as of March 31, 2024.
• End Clients Served: 20.62 Lakhs
• Revenue (FY 2023-24): ₹6.75 Crores (17.07% Y-o-Y growth).
• PAT (FY 2023-24): ₹72.99 Lakhs (Turnaround from a loss).

Geographic Distribution and Market Penetration #

• Domestic Presence: 17 cities across India.
• Recent Expansion (FY 2023-24): Lucknow and Jabalpur.
• International Presence: Representative office in Dubai catering to NRI clients.
• Target Client Segment: HNIs and UHNIs, with a strategic focus on the ₹5 Crores to ₹50 Crores net worth segment. Mass affluent segment targeted via Digital Wealth (DW) vertical using a ‘phygital’ model.

Segment-wise Capex and ROIC #

• Capital Expenditure: Primarily focused on technology infrastructure. In FY 2023-24, ₹151.14 Lakhs invested in enhancing technological infrastructure (standalone), representing 39.73% of IT CAPEX.
• Return on Investment: Consolidated Return on Equity (RoE) reported at 40.43% for FY 2023-24. Return on Capital Employed (RoCE) for standalone entity is 44.33% (FY 2023-24).

Operational Efficiency Metrics #

• Total Assets Under Management (AUM): ₹59,351 Crores as of March 31, 2024 (52% Y-o-Y growth).
• Consolidated Net Inflows (FY 2023-24): ₹7,182 Crores (41% Y-o-Y increase).
• Client Attrition Rate (FY 2023-24): 1.02% of AUM lost.
• Relationship Managers (RMs): 332 as of March 31, 2024.
• RM Attrition (Regret): 0.64%.
• Account Managers (AMs): 394.
• AM to RM Promotions (Last 5 Years): 122.
• Employee Training: Over 1,800 workforce hours conducted in FY 2023-24.

Growth Initiatives and Challenges #

Growth Engines #

• Increased wallet share penetration in existing 9,900+ client families.
• Addition of new clients (1,559 net new families added in FY 2023-24).
• Addition of new relationship managers.
• Compounding effect of investment returns on AUM.
• Target: AUM growth of 20% or more annually.

Digital Strategy #

• Leveraging technology via Digital Wealth (DW) for mass affluent segment (‘phygital’ model).
• Omni Financial Advisor (OFA) platform empowering MFDs (B2B2C model).
• Investment in fully cloud-based infrastructure for scalability and security.
• Development of self-service options (chatbots, analytical tools).

Geographic Expansion #

• Continuing expansion into strategic locations (e.g., Lucknow, Jabalpur added in FY 2023-24).

Talent Management #

• Unique hiring (‘Bharat Story’), training, and retention strategy for RMs and AMs; promoting entrepreneurial culture.

Holistic Offerings #

• Expanding beyond traditional wealth management to include wealth protection (trusts) and wealth transmission (estate planning).

Challenges/Risks #

• Navigating market volatility and complexities for clients.
• Potential delays in policy rate cuts affecting equity markets.
• Managing operational, regulatory, human capital, technology, counterparty, and liquidity risks.
• Addressing data security and customer privacy concerns with expanding digital infrastructure.
• Competition within the growing wealth management sector.

Anand Rathi Wealth Limited - Risk Analysis (FY 2023-24) #

1. Strategic Risks #

• Severity: High
• Likelihood: Medium
• Trend: Stable to Increasing
• Analysis: The wealth management sector is closely tied to economic performance and market sentiment. While India’s growth provides opportunities, global instability and potential economic slowdowns pose risks. Competition from banks, non-banks, and fintech platforms necessitates continuous adaptation. Failure to capture the growing HNI segment or adapt to changing client preferences could impact market share and AUM growth. Geographic expansion introduces execution risks.
• Mitigation: Focus on specific HNI segment, objective-driven investment strategy, holistic value-added services, strong RM network, digital platform development, leveraging India’s growth trajectory.
• Control Effectiveness: Strong AUM growth, high net inflows, increasing client families, and low client attrition suggest effective strategy execution. Positive economic outlook for India provides tailwinds.
• Potential Financial Impact: Slower AUM growth, reduced net inflows, lower fee income, market share erosion.

2. Operational Risks #

• Severity: Medium to High
• Likelihood: Medium
• Trend: Increasing
• Analysis: Reliance on technology creates significant cybersecurity and data privacy risks. Business continuity is critical. Attracting and retaining skilled Relationship Managers (RMs) and Account Managers (AMs) is vital for client relationships and growth. Process failures or internal fraud could lead to financial loss and reputational damage.
• Mitigation: Investment in technology infrastructure, cybersecurity measures, Information Security Management System, robust internal controls, business continuity planning, employee training, RM/AM hiring and development strategy, entrepreneurial culture with incentives, Vigil Mechanism/Whistleblower Policy.
• Control Effectiveness: Low RM attrition, ‘Great Place to Work’ certification, no reported fraud/significant control deficiencies, successful implementation of digital platforms.
• Potential Financial Impact: System downtime impacting operations, data breach costs, loss of clients due to RM attrition, operational inefficiencies, fraud losses.

3. Financial Risks #

• Severity: Medium
• Likelihood: Medium
• Trend: Stable
• Analysis: Market volatility directly impacts AUM valuation and fee income. Exposure to interest rate risk on borrowings appears minimal. Liquidity risk seems well-managed given cash position and nature of business. Credit risk is low. Currency risk exists due to the Dubai representative office but appears minimal. Investment risk associated with Non-PP SPs and other investments.
• Mitigation: Diversified product mix, objective-driven portfolio construction, focus on long-term client relationships, monitoring of receivables, hedging activities, regular monitoring of liquidity and funding by management. Financial instruments risk management framework overseen by Board/Audit Committee.
• Control Effectiveness: Low client attrition suggests stable AUM base. Positive profitability and ROE. Debt levels are low. No defaults reported. Sensitivity analyses performed for interest rate, price, and currency risk.
• Potential Financial Impact: Reduced fee income due to AUM decline, potential losses on proprietary investments, increased financing costs if interest rates rise significantly, minor impact from currency fluctuations.

4. Compliance/Regulatory Risks #

• Severity: High
• Likelihood: Medium
• Trend: Increasing
• Analysis: Operating in a highly regulated sector necessitates stringent compliance. Risks include non-compliance with SEBI LODR, AMFI guidelines, suitability norms, KYC/AML regulations, data privacy laws, and potential changes in regulations. Failure to adhere can lead to penalties, license revocation, and significant reputational damage. Material Related Party Transactions require ongoing scrutiny and approvals.
• Mitigation: Dedicated Compliance Officer and team, adherence to established policies, regular review by Board/Audit Committee, obtaining necessary registrations, internal and statutory audits, secretarial audits, implementation of required systems.
• Control Effectiveness: No penalties/strictures reported in the last three years. Auditors’ reports are unqualified. Directors’ Responsibility Statement affirms compliance systems. Established committees oversee compliance. Compliance with Secretarial Standards confirmed.
• Potential Financial Impact: Fines, penalties, legal costs, suspension/loss of license, reputational damage leading to client loss, business disruption.

5. Emerging Risks #

• Severity: Medium to High
• Likelihood: Medium
• Trend: Increasing
• Analysis: Growing stakeholder focus on sustainability. Rapid evolution of AI and robo-advisory could challenge traditional RM models if not integrated effectively. Changing expectations of workforce, need for new skill sets. Indirect impact via market volatility affecting AUM and investor sentiment. Potential shifts towards stricter fiduciary standards or changes in fee structures.
• Mitigation: Adoption of BRSR reporting framework, ESG initiatives, investment in digital capabilities, focus on “phygital” model, continuous employee training and development, monitoring regulatory landscape.
• Control Effectiveness: Proactive adoption of BRSR. Investment in digital platforms shows adaptation. Stated commitment to ESG principles.
• Potential Financial Impact: Reputational damage if ESG expectations aren’t met, loss of competitive advantage if technology adoption lags, increased operating costs due to climate adaptation/mitigation, regulatory changes impacting revenue models.

Strategic and Management Analysis of Anand Rathi Wealth Limited #

Long-Term Strategic Goals and Progress #

Anand Rathi Wealth Limited (ARWL) focuses on holistic wealth solutions (creation, protection, transmission) for High-Net-Worth Individuals (HNIs), especially the ₹5 Cr - ₹50 Cr segment. Key goals include AUM growth (targeting ~20%+ annually), geographic expansion within India, enhancing digital capabilities (Digital Wealth - DW & Omni Financial Advisor - OFA), and expanding service offerings like estate planning. Progress is evidenced by:

• 52% Y-o-Y AUM growth to ₹59,351 Cr in FY24, driven by strong net inflows (₹7,182 Cr, +41% Y-o-Y) and market appreciation.
• Geographic expansion continued with entries into Lucknow and Jabalpur, bringing the total presence to 17 cities.
• Digital verticals (DW & OFA) showed robust growth in AUM, client base, and profitability.
• Introduction of ancillary services like trust formation and will creation.
• Consistent client performance (14.6% annual return for 10-year+ clients) and low attrition (1.02%).

Competitive Advantages and Market Positioning #

ARWL’s competitive advantages include:

• Focused HNI strategy, targeting an underserved segment (₹5 Cr - ₹50 Cr) with an objective-driven approach.
• Data-driven investment philosophy, combining Mutual Funds and Non-Principal Protected Structured Products (Non-PP SPs), supported by an in-house research team (135+ members).
• Holistic service model extending beyond wealth creation to protection (trusts) and transmission (estate planning).
• “Bharat Story” RM recruitment and training model fostering low attrition (0.64% regret RM attrition) and deep market penetration.
• Strong brand recognition (“Great Place to Work,” #1 non-bank MFD ranking).
• Advanced digital platforms (DW for mass affluent via phygital model, OFA for MFDs).
• Low client attrition (1.02%) signifies high client trust and satisfaction.

Innovation Initiatives and R&D Effectiveness #

Innovation at ARWL is seen through technology enablement and product structuring, including:

• Development of the Digital Wealth (DW) platform and the Omni Financial Advisor (OFA) platform for MFDs.
• The ‘Workstation’ platform enhances RM productivity.
• Sophisticated, data-driven approach to portfolio construction (using models like Efficient Frontier, Sensitivity Calculator) and product selection (rigorous MF screening, Non-PP SP back-testing).
• Successful track record of Non-PP SPs (100% principal return, 94% desired coupon on matured products) and consistent client portfolio performance.
• 1,800+ annual workforce hours dedicated by the research team.

ESG Framework and Sustainability Analysis #

Environmental Metrics and Targets #

Energy Consumption (Standalone FY24) #

• Total energy consumed: 3,979.83 GJ (Previous Year: 2,966.62 GJ)
• Source: Entirely from non-renewable sources (purchased electricity)
• Energy intensity per rupee of turnover: 0.0057 GJ/’ Lakh (PY: 0.0056 GJ/’ Lakh)
• Energy intensity per employee: 3.93 GJ/employee (PY: 3.54 GJ/employee)

Water Consumption (Standalone FY24) #

• Total water withdrawal: 1,203 KL (PY: 1,005 KL)
• Source: Entirely from third-party municipal supply (BMC)
• Total water consumption: Matched withdrawal
• Water intensity per rupee of turnover: 0.0173 KL/’ Lakh (PY: 0.0190 KL/’ Lakh)
• Water intensity per employee: 1.19 KL/employee (PY: 1.20 KL/employee)
• Water Discharge: None

GHG Emissions (Standalone FY24) #

• Total Scope 1 emissions: 3.63 tCO2e (PY: 3.59 tCO2e)
• Total Scope 2 emissions: 322.67 tCO2e (PY: 240.51 tCO2e)
• Total Scope 1 & 2 emissions: 326.30 tCO2e (PY: 244.10 tCO2e)
• Intensity per rupee of turnover: 0.00047 tCO2e/’ Lakh (PY: 0.00046 tCO2e/’ Lakh)
• Intensity per employee: 0.32 tCO2e/employee (PY: 0.29 tCO2e/employee)
• Scope 3 emissions: Not reported

Waste Management (Standalone FY24) #

• Minimal hazardous waste generation due to service nature.
• E-waste and battery waste managed through authorised vendors.
• Paper and general waste handled via municipal authorities.
• Focus on reduction initiatives (e.g., paperless processes).

Reduction Initiatives #

• Using recycled paper notepads.
• Using eco-friendly paper pens (reducing plastic).
• Providing company transport (reducing private vehicle emissions).
• Installing motion sensors for lighting.
• Using energy-efficient HVAC equipment.
• Promoting minimal printing.
• Sensor taps and regular plumbing checks aim to reduce water consumption.

Social Responsibility Programs #

CSR Compliance & Spending (Standalone FY24) #

• CSR Obligation: ₹293.53 Lakhs (2% of average net profit of ₹15,366.43 Lakhs, adjusted for ₹13.80 Lakhs set-off).
• CSR Spending: ₹293.82 Lakhs (₹0.29 Lakhs excess).
• Primarily via contributions to implementing agencies (NGOs, Trusts).
• Focus areas: Healthcare, education, rural development, animal welfare, and livelihood enhancement.
• No spending on administrative overheads or impact assessment reported.

Employee Profile (Standalone FY24) #

• Total permanent employees: 1,012 (PY: 838)
• Gender ratio: 65% Male (658), 35% Female (354)
• Differently-abled employees: Not reported

Employee Well-being #

• Health and Accident Insurance: 100% of permanent employees covered.
• Maternity Benefits: Cover 100% of eligible female employees (35% of total).
• Paternity Benefits: Not applicable/availed.
• Daycare facilities: Not provided.
• Cost incurred on well-being measures: 0.24% of total standalone revenue (PY: 0.20%).

Training & Development #

• Training hours: Over 1,800 workforce-hours dedicated to training in FY24.
• Skill upgradation training: 61% of permanent employees received (PY: 59%).
• Human rights training: 100% received training on human rights issues (including POSH awareness).
• Promotions: 122 AM to RM promotions occurred in the last five years.

Employee Turnover & Retention (Standalone FY24) #

• Permanent employee turnover rate: 14.75% (Male: 13.66%, Female: 16.81%) - decrease from 22.15% in FY23.
• Retention rate for female employees post-maternity leave: 100%.

POSH Compliance #

• Internal Complaints Committee (ICC) established.
• Complaints filed: Zero complaints filed under the Sexual Harassment of Women at Workplace Act during FY24 (PY: Nil).
• Mechanisms exist to prevent adverse consequences for complainants.

Community Engagement #

• Primarily through CSR projects executed via implementing partners.
• Focus areas: Livelihood, financial inclusion, animal welfare, agriculture, community development, education, and healthcare.

Governance Structure and Effectiveness #

Board Composition & Independence #

• As of March 31, 2024, the Board comprised 7 Directors.
  • 1 Whole-Time Director (CEO)
  • 2 Non-Executive Promoter Directors (including Chairman)
  • 4 Independent Directors (including 1 Woman Director)
• Independent Directors constitute 57.14% of the Board.
• All Independent Directors meet independence criteria.

Committees #

• Statutory committees (Audit, Nomination & Remuneration, Stakeholders Relationship, Risk Management, Corporate Social Responsibility) are constituted as per regulations.
• Independent Directors forming the majority/chairmanship where required.
• A Management Committee also exists.
• All committee recommendations were accepted by the Board.

Related Party Transactions (RPTs) #

• A Board-approved RPT policy is in place.
• All RPTs in FY24 were reported as ordinary course of business and at arm’s length.
• Material RPTs require shareholder approval.
• Approval sought at AGM for FY25 transactions.

Internal Controls & Risk Management #

• The company maintains internal financial controls deemed adequate and effective.
• An independent internal audit function exists, reviewed by the Audit Committee.
• A Risk Management Committee oversees the risk management framework, policy, and mitigation strategies.
• Key risks identified include: operational, regulatory, human capital, technology, counterparty, and liquidity risks.

Vigil Mechanism #

• A Whistleblower Policy allows confidential reporting of unethical behavior or fraud.
• No complaints were received in FY24.
• No personnel were denied access to the Audit Committee.

Compliance #

• The company affirms compliance with mandatory Secretarial Standards, SEBI Listing Regulations (Reg 17-27, 34, 46), and the Companies Act, 2013.
• No penalties or strictures were imposed by SEBI/Stock Exchanges/Statutory Authorities in the last three years.
• A certificate confirms no Director disqualification.

Sustainability Investments and ROI #

Technology Investment #

• ₹151.14 Lakhs invested in enhancing technological infrastructure in FY24, representing 39.73% of IT CAPEX.
• Includes initiatives supporting sustainability (e.g., reducing paper consumption, enabling remote work).

R&D #

• Focused on evaluation of financial products, economic trends, and industry developments by a team of 137 research/product specialists.

Return on Investment (ROI) #

• Financial returns from sustainability investments were not quantified.
• Benefits described qualitatively, such as enhanced efficiency, reduced paper/fuel consumption, resource conservation, and improved employee productivity/well-being.

ESG Ratings and Peer Comparison #

Certifications #

• Certified as a ‘Great Place to Work’ five times consecutively.

Market Position #

• Ranked first amongst non-bank sponsored and non-aggregator mutual fund distributors based on direct client delivery (as per Board’s Report).

Regulatory Compliance and Future Preparations #

Reporting Framework #

• Adopted and published the Business Responsibility and Sustainability Report (BRSR) for FY24 as mandated by SEBI.

Environmental Laws #

• Company states compliance with applicable environmental laws (Water Act, Air Act, Environment Protection Act).
• No non-compliances reported.

Social & Labor Laws #

• Compliance with POSH Act confirmed (0 complaints).
• Adherence to minimum wage regulations indicated (93-96% employees paid more than minimum wage).

Governance Regulations #

• Compliance affirmed with SEBI LODR (Reg 17-27, 34, 46), Companies Act 2013, and Secretarial Standards.
• No non-compliance, penalties, or strictures reported in the last three years.

Future Preparations #

• Continued adoption of BRSR indicates alignment with evolving ESG disclosure norms.
• Proactive measures in areas like data security, digital infrastructure, and employee well-being suggest preparation for future operational and regulatory demands.
• The establishment of an Emergency Response Team (ERT) by June 2024 indicates enhanced preparedness.

Financial Performance Analysis (FY 2023-24 Consolidated) #

Revenue Growth #

• Total revenue increased by 35% YoY to ₹751.97 Crores from ₹558.91 Crores.

Profitability #

• Profit Before Tax (PBT) grew by 34% YoY to ₹305.77 Crores. PBT Margin stood at 40.64%.
• Profit After Tax (PAT) increased by 34% YoY to ₹225.82 Crores from ₹168.60 Crores. Net Profit Margin was 30.03%.

Earnings Per Share (EPS) #

• Basic EPS: ₹54.31
• Diluted EPS: ₹54.15

Return on Equity (ROE) #

• ROE stood at 40.43%.

Assets Under Management (AUM) #

• Consolidated AUM reached ₹59,351 Crores, a 52% YoY increase. Private Wealth (PW) AUM was ₹57,807 Crores.

Net Inflows #

• Consolidated net inflows rose 41% YoY to ₹7,182 Crores.

Client Base #

• Active client families increased by 19% YoY to 9,911.

Client Attrition #

• Client attrition rate (based on AUM lost) was 1.02%.

Relationship Managers (RMs) #

• Number of RMs increased to 332. Regret RM Attrition was 0.64%.

Market Capitalisation #

• Exceeded ₹15,000 Crores during the year, standing at ₹15,440 Crores as of March 31, 2024.

Shareholder Returns (FY 2023-24) #

Dividend #

• Total dividend declared is ₹14 per equity share (Face Value ₹5), including ₹5 interim dividend. This represents 280% of face value and a dividend payout ratio of 25.9%.

Buyback #

• Proposed buyback of 370,000 equity shares (0.88% of total paid-up equity) at ₹4,450 per share, aggregating to ₹164.65 Crores (subject to shareholder approval).

Business & Strategy Analysis #

Market Positioning #

• A leading non-bank wealth solutions firm, ranked first amongst non-bank sponsored and non-aggregator mutual fund distributors based on direct client delivery. Focuses on High-Net-Worth Individuals (HNIs) and families, particularly the ₹5 Crores to ₹50 Crores investible assets segment.

Geographic Presence #

• Operates in 17 Indian cities (added Lucknow and Jabalpur in FY24) and has a representative office in Dubai.

Value Proposition #

• Objective-driven approach focused on wealth creation, protection (via trusts), and transmission (estate planning/wills). Emphasizes an uncomplicated, data-driven investment philosophy grounded in mathematical logic and research. Aims for a target corpus of 2x in ~6 years and 4x in ~12 years (~14% p.a. return) with significantly lower risk than the NIFTY 50 benchmark.

Client Longevity #

• 60% of Private Wealth clients have been associated for over 3 years, accounting for 79% of PW AUM, indicating strong client trust and relationship stability.

Product Mix #

• Focuses on Equity Mutual Funds (selects 14 from 584 aiming for 2-3% alpha over Nifty 50) and Non-Principal Protected Structured Products (Non-PP SPs) used as a risk mitigation tool (Plan B). Historical performance shows 100% principal return and 94% desired coupon delivery on matured Non-PP SPs over 11 years.

Digital Initiatives #

Digital Wealth (ARDWPL) #

• Fintech arm serving the mass affluent segment via a ‘phygital’ model. AUM grew 47% YoY to ₹1,545 Crores; client base grew 14% YoY to 4,862. Revenue increased to ₹24.51 Crores; PAT surged 374% to ₹3.41 Crores due to operating leverage.

Omni Financial Advisor (FIINFRA - OFA) #

• PAAS model for Mutual Fund Distributors (MFDs). Subscribers increased to 5,994; platform’s client base grew to 20.62 Lakhs. Revenue grew 17% YoY to ₹6.75 Crores; turned profitable with PAT of ₹72.99 Lakhs.

Growth Engines #

• Management identifies four key growth drivers:
  1. Increasing wallet share from existing 9,900+ client families.
  2. Addition of new clients (1,559 net additions in FY24).
  3. Addition of new Relationship Managers (332 RMs currently).
  4. Compounding returns on investments (AUM growth).

Human Capital #

• Employs 332 RMs and 394 Account Managers (AMs). Recruits AMs from top B-schools/CAs and trains them for RM roles (122 AM-to-RM promotions in 5 years). Unique “Bharat Story” model involves recruiting RMs from smaller towns, training them, and relocating them back to tap underpenetrated markets.

Industry & Economic Context #

Indian Economy #

• Demonstrated resilience with 7.6% GDP growth in FY24. Strong manufacturing and construction sectors noted. Economy undergoing rapid formalization, redirecting savings towards financial assets.

Wealth Management Market #

• Significant growth potential driven by:
  • Rising HNI/UHNI population (projected to double by 2027 at 16% CAGR).
  • Low mutual fund penetration (14% AUM to GDP vs. 60% global average).
  • Shift from physical assets (post-demonetization).
  • Increasing financial literacy and digital adoption.
  • Supportive environment for entrepreneurship creating new wealth.

Investment Trends #

• HNIs diversifying from traditional instruments; demand for sophisticated, objective-driven financial advice to navigate complex products and market volatility. Rise of digital wealth solutions (Robo-advisors, Phygital models).

Risk Management & Mitigation #

Framework #

• Proactive approach involving risk identification, evaluation, and mitigation. A dedicated Risk Management Committee oversees the process.

Identified Risks & Mitigation #

• Operational: Stringent internal controls, routine risk evaluations, cybersecurity investments.
• Regulatory: Monitoring regulatory changes, ensuring compliance, maintaining regulatory body relations.
• Human Capital: Employee training, competitive compensation, positive work environment to attract/retain talent.
• Technology: Investment in technology/cybersecurity, risk assessments, business continuity plans.
• Counterparty: Due diligence, diversification of exposure, use of collateral.
• Liquidity: Maintaining sufficient liquidity reserves, diversifying funding, monitoring cash flow.

Outlook & Forward-Looking Statements #

Management Guidance #

• Expects AUM to grow by 20% or more annually, driven by the four growth pillars.

Market Opportunity #

• Positioned to capitalize on India’s economic growth, increasing HNI/UHNI population, and rising demand for sophisticated wealth management.

Strategy #

• Continued focus on the HNI segment (₹5 Cr - ₹50 Cr), disciplined portfolio construction, leveraging technology (DW & OFA verticals), expanding geographic footprint, and developing human capital.

Investment Landscape #

• Anticipates HNIs will increasingly need disciplined, objective advice to manage complex products and achieve risk-adjusted returns. Believes its long-term perspective and strategies are well-suited for volatile markets and evolving client needs.

Indian Equity Market #

• Poised to attract foreign portfolio flows due to strong economic outlook, fair valuations, and healthy corporate earnings. Domestic participation also expected to remain strong. Declining bond yields could further support equity valuations.

ESG Considerations (from BRSR) #

Material Issues Identified (Risk/Opportunity) #

• Increasing Financial Literacy (Opportunity)
• Digitization (Opportunity & Risk - Security)
• Data Security & Customer Privacy (Risk)
• Corporate Governance (Opportunity)
• Customer Satisfaction (Opportunity & Risk - Attrition)
• Human Capital Management (Opportunity & Risk - Turnover)
• Climate Change (Risk & Opportunity)

Mitigation/Adaptation Approach #

• Investing in technology, digital environment, information security management systems, regulatory compliance reviews, customer service focus, human capital development (training, environment), exploring sustainable alternatives (e.g., reducing plastic/paper use).

Financial Analysis: Anand Rathi Wealth Limited (FY 2023-24) #

Auditor’s Opinion and Qualifications #

• Standalone Financial Statements: KKC & Associates LLP issued an unqualified opinion, affirming a true and fair view in accordance with Ind AS and the Companies Act, 2013.
• Consolidated Financial Statements: KKC & Associates LLP issued an unqualified opinion, affirming a true and fair view. The opinion considers reports from other auditors for three subsidiary companies (AR Digital Wealth Pvt Ltd, Freedom Wealth Solutions Pvt Ltd, Ffreedom Intermediary Infrastructure Pvt Ltd). No Key Audit Matters were communicated.

Key Accounting Policies #

• Framework: Financial statements adhere to Indian Accounting Standards (Ind AS) under the Companies Act, 2013, based on historical cost, except for certain financial instruments measured at fair value (Level 1, 2, or 3 hierarchy).
• Revenue Recognition: Primarily from distribution income (Mutual Funds, PMS, Structured Products), referral fees, consultancy, commission, and IT-enabled services (consolidated). Revenue is recognized on an accrual basis upon satisfying performance obligations.
• Financial Instruments: Classified and measured at Amortised Cost, Fair Value Through Profit and Loss (FVTPL), or Fair Value Through Other Comprehensive Income (FVTOCI) based on business model and cash flow characteristics. Impairment is assessed using the Expected Credit Loss (ECL) model.
• Leases (Ind AS 116): Right-of-Use (ROU) assets and lease liabilities are recognized for lease arrangements, except for short-term and low-value leases.
• Employee Benefits: Defined contribution plans (Provident Fund) are expensed as incurred. Defined benefit plans (Gratuity) are accounted for using the projected unit credit method.
• Share-Based Payments: Equity-settled schemes are measured at fair value at grant date and expensed on a straight-line basis over the vesting period.
• Business Combinations & Goodwill (Consolidated): Acquisition method used. Goodwill represents the excess of consideration over the fair value of net identifiable assets acquired. Impairment testing is done annually.
• Changes: No significant changes in accounting policies were reported for the financial year ended March 31, 2024.

Internal Control Effectiveness #

• The Independent Auditor’s Report on Internal Financial Controls provides an unqualified opinion for both Standalone and Consolidated financials.
• The company has an adequate internal financial control system over financial reporting, operating effectively as of March 31, 2024.

Regulatory Compliance Status #

• General Compliance: Compliance with the Companies Act, 2013, SEBI Listing Regulations, 2015, and mandatory Secretarial Standards is affirmed.
• Auditor Confirmation: Compliance with Ind AS, maintenance of proper books of account, and director eligibility are confirmed. No instances of non-compliance, penalties, or strictures by regulatory authorities related to capital markets were reported.
• Specific Compliance: Adherence to regulations regarding CSR, RPTs, ESOPs, Dividend Distribution, Anti-Sexual Harassment Policy, and Vigil Mechanism is reported.

Legal Proceedings and Potential Impact #

• Company Level: No significant orders from regulators/courts impacting going concern status or future operations. No pending litigations impacting the financial position as of March 31, 2024.
• Subsidiary Level: A contingent liability note mentions a past income tax demand for subsidiary Freedom Wealth Solutions Pvt Ltd (related to AY 2014-15 penalty). Management expects the penalty to be withdrawn. No financial impact is currently anticipated.

Related Party Transactions (RPTs) #

• Nature: Transactions primarily involve the purchase/sale of debentures/securities, support services, rent, brand charges, demat charges, and interest, mainly with group companies and subsidiaries.
• Policy & Approval: A Board-approved RPT policy is in place. Transactions are stated to be in the ordinary course of business and at arm’s length.
• Materiality & Shareholder Approval: Shareholder approval is sought for potential Material RPTs for FY 2024-25 with ARGFL and ARFSL, exceeding the materiality threshold.
• Disclosures: RPT details are disclosed in the Notes to Financial Statements and summarised in the Board’s Report.

Subsequent Events #

• Share Buyback: A proposal to buy back up to 3,70,000 equity shares at ₹4,450 per share was approved on April 12, 2024, subject to shareholder approval.
• Dividend: A final dividend of ₹9 per equity share for FY 2023-24 was recommended on April 12, 2024, subject to shareholder approval.

Accounting Quality Analysis #

• Accounting policies are compliant with Ind AS. Fair value measurements introduce estimation uncertainty.
• Auditors issued unqualified opinions on financial statements and internal controls.
• Consistency in accounting policies enhances comparability.
• Accounting quality appears reasonable, supported by auditor sign-offs and adherence to standards.

Regulatory Risk Assessment #

• The company demonstrates a strong reported compliance record.
• The primary area requiring attention is the management and approval process for large-value RPTs, especially with promoter entities.
• The proposed share buyback requires adherence to SEBI regulations.
• Overall regulatory risk appears moderate, primarily stemming from significant RPT volumes.