Financial Performance Highlights

Assets Under Management (AUM)

  • Total AUM: ₹9 lakh crore, up 31% year-on-year
  • ARR AUM: ₹3,53,000 crore, up 19.7% year-on-year
  • ARR net flows: ₹12,482 crore during Q2 FY27 (compared to ₹10,815 crore in Q1 FY27)

Revenue Performance

  • Revenue from operations: ₹896 crore, up 17.5% year-on-year
  • ARR revenue: ₹706 crore, up 27.5% year-on-year
  • ARR contribution: 79% of operating revenues
  • Transaction and brokerage income: ₹190 crore, down 9.1% year-on-year
  • Other income: Negative ₹44 crore (primarily due to mark-to-market impact on treasury investments)
  • Total revenue: ₹853 crore, up 4.8% year-on-year

Cost Structure

  • Total costs: ₹462 crore, up 15.5% year-on-year
  • Employee costs: ₹342 crore, up 19.9% (includes ₹9 crore one-time impact from business restructuring)
  • Admin and other costs: ₹120 crore, up 4.6%
  • Cost-to-operating income ratio: 51.5% (improved from 54.3% in Q1)

Profitability

  • Operating PBT: ₹434 crore, up 19.7% year-on-year
  • PBT: ₹391 crore
  • PAT: ₹302 crore (compared to ₹316 crore in Q2 FY26)
  • Tangible ROE: 16.9%
  • Dividend: Second interim dividend of ₹7.5 per share approved by board

ARR Retention Metrics

  • ARR retention improved to 79 basis points from 74 basis points in Q1
  • Excluding carry income: ARR retention stable at 67 basis points
  • Carried interest from third-party funds: Approximately ₹60 crore contributed in Q2

Business Segment Performance

Wealth Business

  • ARR AUM: ₹2,52,627 crore, up 24.3% year-on-year
  • 360 ONE Plus advisory platform: Crossed ₹1 lakh crore AUM
  • Net flows: ₹10,990 crore (broad-based across engagement models)
  • ARR revenue: ₹503 crore, up 40.5% year-on-year
  • Retention: 79 basis points (improved from 71 basis points in Q1)
  • Operating PBT: ₹326 crore, up 30.2% year-on-year
  • UHNI clients: Over 4,100 clients with more than ₹10 crore AUM, accounting for 95% of ex-custody wealth AUM
  • HNI business: Manages over ₹8,000 crore for over 1,500 clients with about 60 relationship managers
  • ET Money: 5.5 lakh+ active users, ARR AUM of over ₹700 crore in last nine months

Asset Management Segment

  • ARR AUM: Over ₹100,000 crore, up 9.4% year-on-year
  • Net flows: ₹1,492 crore (improved after large SMA redemptions in Q1)
  • ARR revenue: ₹203 crore
  • Retention: 79 basis points
  • Operating PBT: ₹108 crore

Alternates Business

  • AIF AUM: ₹58,139 crore, up 27.9% year-on-year
  • Fund launches: Multi-stage AI fund, defence and space fund, ARISE credit fund
  • Public markets: Fund performance strengthened, SIF strategy gained traction
  • Dyna-SIF AUM: Crossed ₹1,000 crore
  • Mandates: Won first European institutional mandate, received top-up from existing global mandate

Strategic Updates and Initiatives

UBS Collaboration Progress

  • Target: $600-650 million flows exchange for current financial year
  • Current achievement: ~$300-325 million flows exchanged over last three months
  • Flows from UBS: ~$15 million from fund empanelment
  • Client references: ~$20-25-30 million additional flows
  • Flows to UBS: ~$240-250 million from 360 ONE clients
  • Expected retention: 40-50 basis points on collaboration flows

Leadership Updates

  • Ashish Agarwal joined in senior leadership role with financial services experience
  • No immediate structural changes expected
  • Focus on integration and strengthening leadership team over 6-8 months

Technology Initiative - COMPASS

  • Proprietary AI layer live across wealth, asset management, and enterprise functions
  • Provides integrated interface for research, market intelligence, prospecting, and pitch preparation
  • Offers 360-degree client view with service and business risk alerts
  • Runs entirely within 360 ONE environment with strict access controls
  • Focus on efficiency, commercial impact, quality, and control

Market Context and Outlook

Macro Environment

  • Q2 characterized by two halves for Indian equities
  • Benchmark indices under pressure due to FPI selling, global rate concerns, and geopolitical uncertainty
  • Domestic resilience: Monthly SIP flows touched record ₹32,500 crores in September
  • Primary market activity: ~70 companies raised ₹90,500 crores through IPOs including NSE listing

Growth Tailwinds Highlighted

1. Wealth creation in India: UHNI segment growing at 13-15%, monetization events releasing liquidity

2. Financialization of savings: SIPs, SIF category, democratization of AIFs expanding investable pool

3. Shift to professional wealth management: Demand for transparent, fee-based advice and curated access

4. Global connectivity: Resident Indians investing globally, global institutions refocusing on India, Gift City opportunities

Forward-Looking Priorities

  • Wealth: Focus on adding new clients, raising RM productivity, scaling reference across ecosystem
  • Asset management: Sharpening alternates offering, expanding institutional reach, diversifying domestic distribution, building SIF platform
  • 360 ONE capital: Converting ECM pipeline, strengthening team, expanding research coverage
  • Continued cost discipline and technology as key lever

Capital Structure and ROE Outlook

  • Tangible net worth: ~₹7,400 crore
  • UBS warrant conversion: Expected ~₹1,600 crore addition in February
  • PAT addition: Expected ~₹1,000-1,200 crore post-dividend over next 2-3 years
  • Target tangible ROE: 20% over 3.5-year period (from current 16.9%)
  • No immediate capital raise requirements anticipated

Key Financial Impact Notes

  • Mark-to-market impact: Negative ₹44 crore primarily due to NSE listing affecting fair value changes (~₹110-120 crore impact through funds)
  • Carry income: Includes reversal of previously accrued carry but offset by new carry recognition from NSE listing
  • Mutual fund yields: Decline due to one-time admin fee accrual, otherwise stable
  • TBR composition: Changing from upfront income to brokerage across multiple asset classes