Buy Nuvama Wealth; target of Rs 9100: Motilal Oswal

Motilal Oswal's research report on Nuvama Wealth

Nuvama Wealth’s (NUVAMA) 2QFY26 operating revenue at INR7.7b grew 4% YoY, with the Wealth/Private/Asset services businesses growing 19%/37%/5% YoY in 2QFY26, while AMC/Capital markets business declined 21%/28% YoY. For 1HFY26, revenue grew 10% YoY to INR15.4b. Total operating expenses grew 12% YoY to INR4.4b (in-line), with 8% YoY growth in employee expenses and 23% YoY growth in other opex. The cost-to-income ratio increased YoY to 56.6% in 2QFY26 vs. 53% in 2QFY25 (our est. of 58.9%).

Outlook

We have increased our earnings estimates for FY26E/27E/28E by 5%/3%/3%, considering higher transaction revenue and higher retention in the asset services business, keeping our MPIS/ARR revenue estimates largely intact. Reiterate BUY rating on the stock with a TP of INR9,100 (based on SOTP valuations).