Neutral Anand Rathi Wealth; target of Rs 3100: Motilal Oswal

Motilal Oswal recommended Neutral rating on Anand Rathi Wealth with a target price of Rs 3100 in its research report dated January 13, 2026.

Broker Research

January 14, 2026 / 13:20 IST

Neutral

Motilal Oswal's research report on Anand Rathi Wealth

Anand Rathi Wealth (ARWM) posted an operating revenue of ~INR2.9b in 3QFY26 (5% miss), up 22% YoY but down 3% QoQ. This was primarily driven by a 25%/20% YoY growth in revenue from the distribution of financial products/MF. For 9MFY26, it grew 20% YoY to INR8.6b. Operating expenses rose 22% YoY but were flat QoQ at INR1.6b, fueled by a 21%/24% YoY rise in employee/other expenses. EBITDA was INR1.3b, up 23% YoY but down 4% QoQ (7% miss). EBITDA margin came in at 45.4% vs. 45.2% in 3QFY25. For 9MFY26, EBITDA grew 28% YoY to INR4b. For 3QFY26, PAT stood at INR1b, up 30% YoY but flat QoQ (in line due to higher other income). PAT margin expanded 200bp YoY to 34.6% (est. 33.9%). During 9MFY26, PAT grew 30% YoY to INR2.9b. The firm currently has 393 RMs and ~450 account managers undergoing training to transition into RM roles; with this existing RM strength, management believes the business can be comfortably supported over the next 3–4 years. We cut our estimates by 2% each for FY26/FY27/FY28 to factor in weak quarterly performance.

Outlook

We expect an AUM/Revenue/PAT CAGR of 23%/ 22%/26% during FY25-28, with robust cash generation (INR12.6b of OCF during FY25-28E), an RoE of 36%+, and a healthy balance sheet. We reiterate our Neutral rating with a one-year TP of INR3,100 (premised on 42x FY28E EPS).

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