Anand Rathi Wealth Surges 30.5% in Q2 to ₹99 Crore

Anand Rathi Wealth reported a 30.5% annualised increase in its consolidated net profit to ₹99.35 crore during the quarter ending FY26, as compared to ₹76.3 crore in Q2 FY25 year ago. (Business Standard)

Total revenues of the company have increased by approximately 23% to ₹307.18 crore (Compared to an increase in revenues of 249.6 crore last year), and the Profit Before Tax (PBT) figure has more significantly increased by about 31.3% to ₹134.15 crore. (Business Standard)

Coupled with good profits, Anand Rathi has also declared an interim dividend of ₹6 per share with a record date of 17 October 2025. (ET Now)

The investors might question: Would this performance indicate structural strength, or only a cyclical recovery in the flows of wealth management?

What’s Driving the Upswing?

These core business levers are what make the Q2 performance stand out:

• AUM and inflows rising sharply: The firm’s Assets Under Management (AUM) increased ~22% year-on-year to ₹91,568 crore in Q2 FY26, from ₹75,084 crore a year ago. (Business Standard)

• Net inflows hit new highs: For Q2, net inflows stood at ~₹3,002 crore, up from ~₹2,336 crore in Q2 FY25. Notably, equity mutual fund net inflows surged ~101% YoY to ~₹2,062 crore: (Business Standard)

• EBITDA and margins expand: The company reported an EBITDA rise of 32% YoY to ₹137.5 crore, and EBITDA margin expanded to ~46.2% (vs ~43% a year ago). (NDTV)

• Cost control and operational leverage: Expense growth was relatively moderate compared to revenue growth, contributing to leverage. (Implied from revenue vs profit data)

The consistent rise in AUM, inflows, and margins points to a deeper shift in business performance. Do these trends suggest that both growth and efficiency are at play, rather than just transient revenue gains?

Why This Quarter Stands Out?

• Achieved over half of full-year guidance in H1: In the first half of FY26, the company reported PAT of ₹194 crore, up ~29% YoY, and revenue of ₹591 crore, up ~19%. (Business Standard)

• Low client attrition: The firm disclosed a client attrition (AUM lost) of ~0.18% for H1 FY26, a small number, implying stability of its client base. (Business Standard)

• Strong relative performance amid market weakness: The company noted that its growth came despite weakness in broader equity markets, suggesting the resilience of its model. (Business Standard)

Does this make the Q2 result more than a simple uptick, indicating durability in inflows and investor trust?

What Should Investors Watch Next?

While the headline numbers are impressive, the sustainability of these trends will depend on several forward-looking factors. These will shape the company’s ability to maintain its growth trajectory in varying market cycles.

• Sustainability of net inflows: Can the momentum in equity and alternative inflows continue, especially if markets remain volatile?

• Revenue quality mix: How much of the revenue is from recurring advisory/management fees vs one-time commissions or distribution fees?

• Margin trends and cost control: Will the company maintain or expand margins in leaner phases, or will rising costs erode gains?

• Growth in product offerings and client segments: Will the firm scale into new verticals (e.g., alternative assets, overseas clients) or deeper penetration in existing segments?

• Regulatory and market risk: Inflows depend on the capital markets' performance and regulatory conditions for wealth and mutual fund businesses.

Each of these factors will help determine whether this strong quarter is an anomaly or the start of a sustained march upward.

What’s Powering Anand Rathi’s Growth Momentum?

Performance is still being fueled by a mix of growth in client base, increased AUM, and steady flow in its mutual fund and equity advisory business. The company's emphasis on affluent and HNI segments has allowed the firm to gain market share, and retention of customers is getting better due to digital onboarding and the upgrades of its platforms. Operating leverage is high and cost is managed, resulting in growing profitability, as indicated by growing margins and yielding increasing per-client.

Conclusion

The surprising fact that Anand Rathi Wealth increased its profits by approximately 30.5% combined with strong inflows and AUM growth are indicator of exceptional performance during Q2 FY26. The results represent overall strength in growth in the top line and operational leverage. But as usual, when it comes to wealth and asset management, the bigger question remains: Will the firm be able to keep the inflow momentum, maintain the margins, and provide consistent returns despite a possible shift in the market winds?

References

Business Standard
ET Now
NDTV