Anand Rathi profit jumps, but other income drives over half of pre-tax profit
Standalone margin improved sequentially as revenue grew faster than expenses, but remained well below last year's level.
Filed 09 Jul 2026, 17:31 IST · after market close · Anand Rathi Wealth Ltd (ANANDRATHI)
Key takeaways
- Standalone net profit rose 76.97% year on year, but 52.89% of pre-tax profit came from other income.
- Operating margin recovered 4.63 percentage points sequentially, though it remained 12.77 percentage points below Q1FY26.
- The stock gained 2.44% on the first session after results, a smaller move than its 3.52% median absolute reaction.
Price around the results
Profit growth was led by non-operating income
Standalone revenue grew 18.21% year on year and 12.88% sequentially, but the larger swing came from other income, which rose 1101.66% year on year and 62.69% sequentially. That lifted pre-tax profit 65.87% year on year and 48.79% sequentially. Other income contributed 52.89% of pre-tax profit, making the reported net-profit growth less reflective of operating performance.
Costs compressed the year-on-year margin
Expenses grew 46.90% year on year against 18.21% revenue growth, narrowing operating margin by 12.77 percentage points. Sequentially, revenue grew 12.88% while expenses grew 5.43%, allowing margin to recover 4.63 percentage points from Q4FY26. The lower tax rate also supported profit: it fell 4.98 percentage points year on year and 5.40 percentage points sequentially.
Margin remains below the earlier FY26 run rate
Operating margin declined for three straight quarters from 47.37% in Q1FY26 to 29.97% in Q4FY26 before the Q1FY27 recovery to 34.60%. It was still 28.08 percentage points below the 62.68% median for 24 Financial Services peers that had reported the same quarter, placing the company seventh from the bottom on this measure.
Management points to scale and capability building
Management said it had given FY27 revenue guidance of Rs 1,415 crore. The company said growing HNI families are expected to drive demand in India's wealth-solutions market. Its presentation also said a capability-building programme delivered more than 6,500 person-hours in Q1FY27, while equity mutual-fund net-inflow market share had reached 2.30% in FY26 from 0.18% in FY20.
Initial share reaction was positive but not unusual
The stock rose 2.44% in the first session after the results, with volume at 2.88 times the reference level, and was up 1.05% on the next session. It was down 1.09% by the fifth session. Against eight recent result reactions, including five rises and three falls, the initial move was smaller than the 3.52% median absolute move; the results were filed after market close.
Q1FY27 at a glance
Standalone figures as filed with NSE — cross-checked against an independent source.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹313 cr | ₹277 cr | +12.88% | +18.21% |
| Other income | ₹109 cr | ₹67 cr | +62.69% | +1101.66% |
| Expenses | ₹205 cr | ₹194 cr | +5.43% | +46.90% |
| Operating profit | ₹108 cr | ₹83 cr | +30.29% | -13.67% |
| Operating margin (%) | 34.60% | 29.97% | — | — |
| Interest | ₹4 cr | ₹3 cr | +4.42% | -11.06% |
| Depreciation | ₹8 cr | ₹8 cr | -6.40% | +21.28% |
| Profit before tax | ₹206 cr | ₹138 cr | +48.79% | +65.87% |
| Tax | ₹43 cr | ₹36 cr | +18.02% | +33.72% |
| Net profit | ₹163 cr | ₹102 cr | +59.66% | +76.97% |
| EPS (₹) | ₹9.83 | ₹12.31 | -20.15% | -11.52% |
Operating margin of 34.60% compares with a Financial Services sector median of 62.68% across 24 peers that have reported Q1FY27.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +2.44% | +1.42% |
| Next session | +1.05% | — |
| 5 sessions | -1.09% | -2.64% |
Volume on the results session was 2.88× its 20-day average.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
Guidance & outlook
- The company gave FY27 revenue guidance of Rs. 1,415 crore.
- The company expects growing HNI families to drive growth in India's wealth solutions space.
New initiatives
- The company has a capability-building programme that delivered more than 6,500 person-hours in Q1FY27.
Competition
- ARWL's equity mutual fund net inflow market share increased to 2.30% in FY26 from 0.18% in FY20.
- ARWL's equity mutual fund AUM market share increased to 1.48% in Mar-26 from 1.01% in Mar-19.
What to watch
- Whether revenue growth continues to exceed the Q1FY27 expense-growth rate of 5.43%.
- Whether operating margin holds above 34.60% after the Q1FY27 rebound.
- Whether other income remains close to its 52.89% share of pre-tax profit.