Anand Rathi Wealth Services Unlisted Shares
1) They are one of the leading non-bank wealth management services firms in India that caters to a large spectrum of clients through a mix of advisory, distribution, and technology solutions. They are one of the few wealth management companies in India that cater to clients across mass affluent, HNI as well as the Ultra HNIs through various solutions ranging from personal service to technology and Robo-advisory.
They carry out their business through three business verticals, namely;
a) Private Wealth Management (“PWM”)-
They provide wealth management solutions to their clients which include facilitating client investments in various financial instruments including but not limited to, mutual funds, debentures, structured products, and equity derivatives for the purpose of investment strategies. PWM vertical caters to the Ultra HNI and HNI segments of the clientele. The revenue-generating activities include distribution of mutual funds, sale of financial products, and investment advisory fees.
b) Digital Wealth Management (“DWM”)
The DWM vertical allows them to build an economically feasible wealth management model for services to the mass affluent market.
c) Omni Financial Advisors (“OFA”).
OFA is India’s leading tech platform for IFAs to service their clients and grow their business.
2) They are part of the Anand Rathi Group, founded by Mr. Anand Rathi and Mr. Pradeep Gupta in the year 1994
with a focus on stock-broking services and subsequently, has expanded into a diversified financial services
conglomerate in the country with a presence in segments, including non-banking financial services, wealth
management, stockbroking, investment banking, and insurance broking. The Anand Rathi Group has expanded
its geographical footprint and operates through 98 offices across India and the Middle East, which they service
through business associates and representative offices/associate companies.
3) The Asset under administration (AuA) of the company has jumped from.15,489 crore to Rs.18,121 crore between the end of FY18 and FY19. The number of wealth strategists has increased from 199 in the previous year to 234 at the end of last year.
Business Performance in 2018-19
a) During the financial year 2018-19, the total income of the company was at Rs. 280.6 crore as against Rs. 219.3 crore in the previous year recording a growth of 28%.
b) Incommensurate with an increase in revenue and total expenditure also increased by 26% from Rs. 147.97 crore in FY18 to Rs. 187.04 crore in FY19.
c) During the year under review, with much higher growth in revenue versus expenditure, company’s before tax increased nearly 31 % to Rs.95.5 crore and profit after tax by 29.62% to Rs. 65.2crore.
d) Total number of Financial Strategists has increased from 199 in March 2018 to 237 in March 2019.
e) Total asset under administration (AuA) has increased from Rs. 15,489 crore to Rs. 18121 crore between the end of FY18 and FY19.
f) During the year Three Off-site conducted (Including Two International Offsites).
g) No. Of relationships (active client families) has increased from 3235 as of 31 March 18 to 4208 as of 31 March 19.
h) Increase in team size increased from 392 as of 31 March 2018 to 572 as of 31 March 2019.
Anand Rathi Wealth Services Unlisted Shares Details:
| Total Available Shares: | 100 |
| Face Value: | ₹ 5 Per Equity Share |
| ISIN: | INE463V01026 |
| Lot Size: | 25 Shares |
| Current Unlisted Share Price: | ₹ Best in Industry Per Equity Share |
| Retail Discount: | Bulk Deal (1%) |
Promoters And Management:
FINANCIAL SUMMARY
The summary of the Company’s financial performance, both on a consolidated and standalone for the Financial Year 2020-21 as compared to the previous year FY 2019-20 is as under:
(Rs. In Lakhs)
| Particulars | Consolidated | Standalone | ||
| FY 2020-21 | FY 2019-20 | FY 2020-21 | FY 2019-20 | |
| Total Revenue | 27,924.85 | 33,642.72 | 26,225.28 | 32,805.75 |
| Less: Total Expenditure | 21,636.58 | 24,982.03 | 19,990.76 | 23,229.92 |
| Profit / (Loss) before Taxation | 6,288.27 | 8,660.69 | 6,234.52 | 9,575.83 |
| Less: Tax Expense | ||||
| Current Tax | 1,786.34 | 2,585.53 | 1,782.79 | 2,584.13 |
| Deferred Tax | 46.98 | (64.11) | 32.74 | (136.10) |
| Net Profit /(Loss) after Tax | 4,454.95 | 6,139.27 | 4,418.99 | 7,127.80 |
PERFORMANCE HIGHLIGHTS AND STATE OF COMPANY’S AFFAIRS
Our standalone revenue from operations and net profit after tax for FY 2020-21 were ₹ 26,225.28 Lakhs and
₹ 4,418.99 Lakhs respectively as compared to ₹ 32,805.75 Lakhs and ₹ 7,127.80 Lakhs respectively for FY 2019-20. Our consolidated revenue from operation and net profit after tax were ₹ 27,924.85 Lakhs and ₹ 4,454.95 Lakhs respectively for FY 2020-21 as compared to ₹ 33,642.72 Lakhs and ₹ 6,139.27 Lakhs respectively for FY 2019-20.
Our revenues were adversely affected due to the sharp volatility and fall in markets due to the pandemic, which lead to lower fee incomes and trading losses. This was offset to some extent by the company by rationalisation of manpower and other costs during the course of the year, which have also created long term efficiency gains. There has been significant rebound in revenues in the last quarter and during first 2 months of the current financial year.
COVID-19 Pandemic: Responding to an unprecedented challenge
The COVID-19 pandemic significantly disrupted the Indian economy. In order to contain the spread of the COVID-19 pandemic, the Government of India (GOI) along with state governments declared a lockdown of the country, including severe travel and transport restrictions and a directive to all citizens to shelter in place, unless essential. The COVID-19 pandemic and associated responses have adversely affected, among other things, workforces, consumer sentiment, liquidity, economies, trade and financial markets around the world, including in India. The lockdown required private, commercial and industrial establishments to remain closed for long period of time.
The recent second wave in Covid-19 cases has caused lockdown and curfew in many states resulting in a dip in consumer confidence and reignited uncertainty regarding the near-term outlook and are derailing economic momentum.
The global economy is recording a major growth turn around in recent months. Across countries, there has been acceleration in growth of GDP, industrial production, and retail sales. The forward-looking indicator such as purchasing manager index for manufacturing and services are also suggesting improving growth outlook for most economies. The low base effect of the last year due to the pandemic induced lockdown and progressive lifting of lockdown restrictions as the rate of infection falls and rate of vaccination rises are resulting in normalization of growth. Government has indicated that vaccine will be given to every adult citizen (above 18 years) which may help to reduce the transmission of Covid-19 by December 2021.
Overview of Private Wealth Business:
We are one of the few pure wealth and distribution services company in India catering to the HNI as well as the Ultra HNI segments, offering various innovative financial products and investment solutions through dedicated Relationship Managers and have carved out a special niche for ourselves. We have developed a unique un-complicated and client focused strategic approach.
We have structured our private wealth business on four main tenets – objective/ goal based approach, data backed recommendations, simplified approach and transparency in implementation.
We believe in an ‘uncomplicated’ objective-oriented approach towards private wealth business, coupled with highly motivated team of trained Relationship Managers help us in attracting and servicing HNI and Ultra HNI clients.
(Rs. In Lakhs)
| PARTICULARS | AS AT MARCH 31, 2021 | AS AT MARCH 31,2020 |
| Equity share capital | 1,375.68 | 1,351.37 |
| Total Equity | 27,976.91 | 22,506.35 |
| Earning per equity | 15.97 | 26.04 |
Financials of Anand Rathi Wealth Services Unlisted Shares:
| Particulars( in Lakhs) | 2020-21 | 2019-20 | 2018-19 | 2017-18 |
| Revenue | 27925 | 33642 | 28410 | 22372 |
| Employee Cost | 15076 | 16720 | 13276 | 10422 |
| Other Expenses | 4499 | 5773 | 6708 | 5218 |
| EBITDA | 8350 | 11149 | 9450 | 8121 |
| OPM | 30% | 33% | 33% | 36% |
| Interest Cost | 289 | 328 | 334 | 873 |
| Depreciation | 1773 | 2160 | 690 | 518 |
| Profit Before Tax | 6288 | 8660 | 8425 | 6730 |
| Tax | 1833 | 2521 | 2516 | 2122 |
| Net Profit | 4455 | 6139 | 5909 | 4608 |
| NPM | 16% | 18% | 21% | 21% |
| Shares | 275.136 | 270.274 | 269.09 | 268.86 |
| FV | 5 | 5 | 5 | 5 |
| EPS | 16.13 | 22.36 | 21.96 | 17.19 |
| Net Worth | 25318 | 19792 | 13501 | 7816 |
| RONW | 18% | 31% | 44% | 59% |
| Book Value | 92 | 73 | 50 | 29 |
| Capital Employed | 28568 | 24809 | 13550 | 8399 |
| ROCE | 16% | 37% | 65% | 97% |
Comparison With Peers:
(Figures in Crores)
| Company | Revenue | EBITDA | OPM | PAT | NPM | Debt | D/E | P/E | Mcap | Mcap/Revenue |
| IIFL Welath Management | 1600 | 894 | 55% | 370 | 23% | 4700 | 1.68x | 27 | 10k | 6.25x |
| Anand Rathi Wealth | 280 | 85 | 30% | 44 | 15% | 35 | 0x | 40 | 1800 | 6.42x |
