Anand Rathi Wealth Limited (ANANDRATHI) Q2 2027 Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to the Q2 and H1FI27LINX conference call of Anandrathi Wealth Ltd. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on your touchtone phone. I now hand the conference over to Mr. Feroz Aziz, Joint CEO of Arnansati Wealth Limited. Thank you, and over to you, Mr. Feroz.

Thank you so much. Good afternoon, and thank you, everyone, for joining the earnings conference call for the quarter and half year ended 30th September, 2026. Today on this call, we have with us the CFO, Mr. Rajesh Sir Bhutra, our Head of Investor Relationships, Mr. Vishal Sanvi. Jugal Sar Mantri is in Europe, holidaying, so we don't have him on the call today. And this is the first quarter call I'm doing without him, so I miss him in this call. Yeah, so I am very pleased to share that we have delivered another quarter of consistent and fortunately market agnostic performance, despite the challenging environment. This is our 20th quarter result, since we got listed in December 2021. And in every quarter since listing, with God's grace, the PAD growth YOY has been greater than 20%, excluding the impact of non-business-related items, fair value gains, and ESOP expenses, and related tax effects. After tax for the first half year of FY27, after tax PAD grew by about 23% year-on-year to 238 crores, while revenue increased 17% year-on-year to 693 crores. Similar for the Q2 FY27, we reported a consolidated net profit of 122 crores, registering a year-on-year growth of 22%. Total revenue during this period rose by about 16% to 357 crores. In the first half year of FY27, the company has delivered 49% of the full-year revenue guidance, which stands at 1415 crores. So, 49% penetration on the guidance of revenue, and 52% penetration on the PAD guidance, 48% more to go of the 460 guided. Continuing our policy of rewarding shareholders, the board of directors have declared an interim dividend of 4 rupees per share, and after a bonus, so 4 rupees per share of the new 16 odd crores shares, which are outstanding. In the first six months, we have achieved 52% of the PAD guidance of 460. I think that's already mentioned. We've achieved three important milestones in this quarter, which have gone by. The highest net flow ever in the history of Anandrathi wealth of the last 20 years happened in this quarter, which went by, and we collected new fresh monies of 4,186 crores, which is up 39% from the last year's number, corresponding number, of FY26 quarter ending September. So, 4186 crores of net mobilization or new monies with our clients' gratefulness, and when the clients realize that this portfolio during bad times can hold up, bad times, clients have shared more monies with us. Second, we recorded our highest ever quarterly equity mutual fund net flow. Again, in the last 20 years, we have not been able to achieve that. And with your support and client support, we have achieved 2,867 crores, up 39%. It's easy to say buy equities low and sell high. And clients pragmatically have bought more equity, which shows up in IRRs over long periods of time. Courage translates into IRRs, but not in the short term, in few years. So, I'm very happy to note that our clients, unlike the mutual fund industry, has not delivered the best net mobilizations in the first half year. SIPs, of course, have been robust. Lumpsums have been low. In that half year and the last quarter, we have had a 39% increase in equity mutual fund purchase. Third, we recorded our highest ever monthly client acquisition in the month of September, which will not be apparent in the result because I'm speaking about September. With God's grace, and clients, when they see their portfolios doing relatively better, of course, sadly not the best times, they start referring their friends who are parashaan with what has happened in their portfolios with aggressive strategies. In our flagship business of private wealth, during the last 12 months, we have added 1,500 new client families on the net basis, bringing our total client families to 14,309. Client attrition rate in terms of AUM loss remained low 0.17% for quarter to FY27 and 0.26% for half-year FY27. Of course, these are second decimal numbers, but yeah, we would ideally want every client family who trusts us with their hard-earned life savings to be satisfied. The attrition continued to remain low. Two RMs whom we considered regret mathematically, of which one I might want to not call. Mathematically, I can't call that person a non-regret. I would say one regret attrition we have had in H1FY27. Digital wealth business, which is B2B2C business, registered an AUM growth of 14% year-on-year and reached 2,531 crores, and the number of clients increased 15% to 7,580 crores. OFA business, Omni Financial Advisor business, which is a SaaS platform, has close to about 6,898 subscribers with a platform assets of about 1.66 crores at the end of September 2026. As to be remembered, these are just platform assets which we report. Also, last quarter, we started operations in London, UK, and we have received requisite regulatory approvals to commence operations in Gift City, India. That's where I stop and hand over the mic back to the monitor.

Thank you very much. Go ahead.

Yeah, hi. Good afternoon, everyone. Sir, just a few questions. Firstly, a broader one. If you have to think about your, say, top 100 customers, roughly in your estimate, what would be the wallet share that Anandrathi Wealth could have for them?

Firstly, yes. My top 100 clients, I don't have to think of them because I think of them 24-7. So, I've done a light enough. Okay. So, coming back, because that's where we have the platinum segment. Okay. More than percent and a half of our clients fall in the platinum segment. What kind of wallet share? It's very dispersed. See, basically, we have this principle of home grow the colleagues, home grow the clients. So, we don't flop on the doors of people who have just had a business sale of 200 crores. So, I would say that our platinum clients, I can say confidently that 50-60% of the wallet would be with us. And the same clients, if I see the trend, which is what I think is important, would be an upward trend for 95% of the families. So, top 100, I would say 60-70%. And there will be several with 100% with us. That's what stands out.

So, that's the part of, when you say the numerator, the denominator is the mutual fund net worth, or you are saying of the total net worth?

See, wealth has only one definition. Unfortunately, market defines, however, I am speaking about wealth. Wealth includes all the assets, physical also, which they don't live in. Not just mutual stocks. I count everything as wealth. Wealth is everything one human being has, which he does not consume or aspires to consume.

You got that. The second, actually, is more of a financial question. We've seen a very, including the ESOP cost, we've seen a very sharp increase in employee cost from the time we've given ESOPs, which was in fourth quarter. Now, how should we see this and model, say, next year? Do we see an increase in expense? Ideally, the ESOP expenses is the highest in the first year and then it's on a declining trajectory. Should we go in similar manner and assume that the Yes, sir.

Non-cash expenses, which is where ESOP falls, mark-to-market and non-cash expenses, the dispersion between your profit before tax, which is 122 crores, and this 90 crores will reduce. Yes. So, to answer your question, will the ESOP cost reduce? Yes, dramatically, yes.

Got that. And just one final question is on the MLD part, where, you know, anything that worries you on this business, which kind of, say, runs at the top of your mind, that business has been growing well for us, no doubt on that front, but does that, any part of that business worries you in any sense?

The answer is yes. So, is it scalable? The answer is a big yes. Of course, people would still take it with a pinch of salt because they don't trust the professional who generally is people. I don't know why, but yeah, I would do a straight talk. So, no, that doesn't worry me. But yeah, I know most people won't believe that statement. They didn't four years back. They don't today.

So, even in this falling market, you would have given very healthy IRRs on these products?

Yes, sir, we would have given. Some of them didn't give the maximum IRR in the last quarter. Otherwise, we had 1,190 consecutive products, consecutive products from December 2020 till as much as May, June this year, which is the longest streak of wins any product in the history of India would have given expected return, all of them. But that streak broke in this year, and some products didn't deliver the full 14-15%, but delivered 6-7. None of them in the history of Anandrachi's issuance from 2012, December, have ever lost money.

Do you think the slowdown in the growth now will be a challenge for this M&D business? The question is, from the near-term perspective, do you see that as a risk for future flows?

I can answer it in two ways. One is, if I don't see a growth of 20-25% this two quarters, for example, if that's near term, I would have revised my governance downwards. Okay, one thing you can expect from us as professionals is courage. 25% pad growth, long term, or larger cycles also impact structure product business? The answer is no. Why? Because unlike a number of structure products is very high. Tomorrow, today, now, let's assume, I was just speaking to a journalist a few days back, couple of days back, and I said Nifty has stopped representing the Indian broader market because there's a lot of short buildup of FIIs in the Nifty stocks because we have opened up some degree of short possibilities there by some regulatory changes. Not a great barometer for me to issue a structured product. Can I do it on Nifty, Broad, Nifty, NFC 500 if there were futures listed? So there is a lot of agility. I get for five years is too much to ask for in the contemporary situation. Can I make a product with 50? The answer is yes. So coming back, long term, the agility of a structure product, which can embed any long term derivative, becomes so it's a very high, I will start buying calls, I will start buying, I will start selling calls instead of buying puts or, so basically, if your volatility is low, if your volatility is high, you will make a low vega product. If your rows are high, then you will make a low-denta product. Agility becomes contemporary, unlike a long-only mutual fund, has to be long-only. Long is also not calibratable in the category 2 of equity mutual funds. If I have bullishness, I will get a target of Nifty. I worry about the demand? No. I worry about when do I get my trades to 50. I have to give a guide.

Thanks. That's helpful. If I have a few questions, I will come back and thank you. Thank you, sir.

Thank you. The next question is from the line of Shrenik Mehta from IndoAlps. Please go ahead.

Hi, I just wanted to, so congratulations for the great set of numbers, very consistent. You have these HNI clients, which are 50 close and above. These are a big chunk of your overall revenue. I just wanted to understand if the yields that you get are similar for this segment versus, say, the 5 to 50 crore segment yields that you fetch?

Absolutely. I get, if not the same, marginally better. Maybe I'm not checked, but we don't give any discount on fee. The economies of scale only increases value and its services, but does not produce fee. So I can proudly say we may be one of the few wealth management outfords which has never taken a check indirect from a client, irrespective the person offered us thousands of crores. So the answer is no. As you go up the pyramid in terms of my clients, that's why we home grow them. So most of my largest clients have been with us for 15 years. They would have started with two crores.

Wonderful. Thank you so much.

Thank you, Meta, sir.

The next question is from the line of Sukrit De Patij from my side, FinTrade Private Limited. Please go ahead.

Good afternoon, the team. I have two questions. My first question is, just want to understand the forward guidance. Beyond the regular outlook, what are the top two to three execution priorities you're focusing on in the next few quarters to drive client acquisition, Wallet share expansion and AUM growth. And alongside that, what do you see as the key risk from market volatility, changing the constant changing investors' sentiment or increasing competition? And how are you preparing to manage them while rendering the company's overall market share? That's my first question. I'll ask my second after this. Thank you.

Wow. This is a question that I can go on and on because you ask me everything practically I do. So, but yeah, coming to the, on the lighter note, I was saying that, but on a serious note, when you look at our principle, our tiddhant or our bunyad on which we build our business is not do new things every quarter or every year, do the same old thing in a better fashion again and again. What do I do for client acquisition? I do events. Of my clients, colleagues, societies, very low-cost events, I go to their places and collect 15 people. So, I have done 130 events. Okay, I don't know. So, I have an events department which don't do those fancy events. They do, of course, but those are not the premise of my acquisition. So, if my client loves me, I will say, sir, you can do an event in society. So, then he will speak. Or they actually refer us clients there. If they think I have added enough value in life. And if I have 14,000 families, my 7,000 families have finished three, three and a half years. There are 2,500 families who have finished 10 years maybe. Right? 2,000 odd. Don't hold me to that number. So those are the guys who actually give me events. That's one way. So acquisition we acquire on the basis of now, today, website leads has become a reasonable source, where people reach out to us, thanks to some degree of awareness of our services, they reach out to us. So over the next three, four years, I would see cold calling is something which we don't like redoing, because we don't like as human beings receiving phone calls on a Sunday afternoon, random people. So, we want to avoid that in the future, but we are building references. I've always been 50-70% of our clientele. We want that plus website leads. People either have to walk up to us or they have to be referred. That's the destination model in three years. Okay, great. We did in this financial year. So, we have done, Vishal sir has figured out in the meantime, 165 events we have done. So, so do events, not those where you're trying to brand yourself as bigger and spend gross. That's not the end. So that's on the acquisition side. Wallet penetration is deliver Jensen's alpha. Most people don't deliver Jensen's alpha. If you deliver somebody Jensen's alpha, in India, Jensen's alpha is mistaken to be alpha. Jensen's alpha deliver, that will give you the wallet. We go with the assumption that my client is smart. Of course, that's why he is HNI. He is 1% or little lesser than 1% of India. So do I have to convince him to give me money or I have to deliver to give him money? Actually, if you think logically, I don't have to convince him. I just have to deliver. Deliver, not absolute return. Because absolute is not in my control. Trump saab bet, you know? So relative is in my influence, not even in control. So that's where, like, you do a mutual fund selection out of 927. You try and make sure that you beat the Nifty or NFC 500 by 2-3% after earning my 1%. Then the client knows, okay, he's accumulating small, small buffers. Like, our model portfolio on the equity mutual fund side, from 1st of June 2013, audited, okay, across 13 years, has delivered 198% alpha on Nifty and about 100% alpha on NSE 500. Right? So, even if the market fell by 50%, the guy has still beaten Nifty in 13 years. Do you understand what I'm saying? So, that is in control. So, how do you penetrate into one's wallet? By doing finance like a treasury, not like a wealth manager.

Thank you. Can I ask my second question?

Yes, absolutely.

My second question is to Mr. Bhutara. From operations and financial management point of view, what are the key risks you are monitoring around cost structures, technology investments, and regulatory compliance or business scalability, and what measures have been taken to ensure the cash keeps on flowing and margins are maintained at stable rates.

Rajesh Bhutra ji has to only be Rajesh Bhutra, and this all will happen, because Rajesh Bhutra has finished 25 years in this company. Rajesh Bhutra, please tell me, and then I will give you my tip.

Yes, sir. Hello. Good afternoon, everyone.

Yes, sir. Margin maintained will you be asked?

No, we have maintained all the margin, no TESDI, EY, ZX in our case, or...

Thank you, Rajesh. You are asking. Yes, tell me, Rajesh.

No, the technology side, we have a strong technology team as well as a strong system. So, technology side does not have any issue for our business side.

Thank you, Rajesh. So, to add to Rajesh, sir, one is how we look at cost, we look at it like we don't want operational efficiencies. What do you call that? Operating leverage. Okay, we want to reinvest in our business. 40% is my target. I have to have my PVT above 40%. I have to have my PAT above 30%. This is what has been told by my boss. So, it's Pasar Ki Lakheer. We try and do that. How do we look at cost? We don't become flamboyant sometimes when things are good, so on and so forth. So, point one, is our technology going to become more efficient? Our costs are going to go up? I don't think it will go up. Second, are we building our technology on a different tangent than the industry? The answer is yes. So, for example, we hired four IITNs who are designing algos for me to research. Okay, I'm one of the kind of stuff which happens in a treasury more so. So technology, we will spend some money. But any time our PBT increases beyond a certain level, we would want to reinvest in strengthening a lot of verticals. Okay, which is what Rakesh says, if you have to in good times, when your PBT is going to go up more than you expected, 43, 44, 45 is okay. It's an order of magnitude of 40. It becomes 48. Great. Now, I don't want to impress the shareholder saying that I have operational efficiencies. I would bring it back down by investing in things which I think would keep my business up and running and consistently running 20 years from now. Thank you. A little more narrow, I'll tell you. Sorry.

No, it pretty much answers my question. Thank you, and best wishes.

Thank you, sir.

Thank you. The next question is from the line of Mohit Jens from Taga Capital Partners. Please go ahead. I am sorry to interrupt you, Mr. Jain. We are unable to hear you. Your voice is breaking. Can you please check? No, sir. We are unable to hear you. Mr. Jain, we are unable to hear you. We will request to please kindly check your connection and join back in a queue. In the meanwhile, we will move to the next question, which is from the line of Milan Kulkarni from MLDL. Please go ahead.

Yeah, good afternoon. How much are the non-cash charges in the quarter? Sir, non-cash charges and mark-to-market, right?

So, non-cash charges, I think, 40 crore.

Non-cash charges, Firozai, 46 crore. 46 crore.

What was it in the corresponding quarter of the last year?

Zero, sir.

Last year was zero. Same quarter last year was zero.

Okay. Thank you. Thank you for the question, sir.

Thank you. The next question is from the line of Nikhil Agarwal from Choice International. Please go ahead.

Hi, everyone. So, my question is, I'm wondering about the company. In July 2021, your new subsidy, Anandrati, with FME, received in principle approval with the MyXPA. So, could you please throw some light about this as any opportunity you are targeting to us?

Okay, sir. If I understand it right, gift city, you've got an approval. What kind of revenues would you expect, or what kind of revenue opportunity would you expect?

Yes.

Correct? So, we are a very India-centric organization. So, we will use that license, as of course expected, and the license in nature as well, to bring money to India. And when you bring money to India, we will try and deliver the Indian resident proposition to an NRI. Today, in the Indian resident proposition, we have mutual funds which we choose mathematically, and then we design structure products. So we will try and deliver the same proposition in a more tax-efficient fashion to an NRA. That's the expectation. So what kind of revenues are possible? I don't want to count my eggs today. But do I, it's very exciting times for me if I can get global capital into an already validated proposition. The answer is yes. Will I do anything different? No. Will I do what I have done in a different platform for a larger universe and larger transfers? That is yes. So, if, for example, if there is a London guy who wants to invest in India, I would use the position which has a credibility of 14, 13, 14 years.

So, to interrupt, any things planned for this year?

Yes. See, yes. So, there are a lot of advantages there. Should I plan any revenue? You should go with, for my first 20-25% bad growth or revenue guidance for this year, I have not provisioned anything. We have not provisioned anything. We like to see the proof of concept, what our client objections initially is, and we meant that we do a lot of trial and error before we become very confident to put them into our revenue data.

You got it. Thank you.

Thank you, sir.

Thank you. Next question is from the liner, Sunil Shah from Isari PMS. Please go ahead.

Yeah, hello, hello to everyone and everybody in the team. Always wonderful to have a talk here. Sir, my point was about the gift-sheddy thing, and I think, you know, we got some clarity there. So it's going to be inward remittances or inward investments. Are we looking at doing something out of India, replicate our model, take money out of India to the group city as well, or it's just going to be inward at least to start with? That's my first point there.

Yes, Sunil, sir. Okay, you want me to answer the first one first? Yes, because you've lost, that is implied. So, yes, Sunil, sir, in the short term and in the long term current thought process is to only look at inward. Because I think India itself requires a lot of homework currently. And I can give you example after example of what kind of research is unraveling our understanding of Indian capital markets, right? Now, we were doing a study on 213 derivative stocks, and there's so much understanding still left, and I feel ashamed that I've worked in this market for 22 years as a professional. I've still not understood some facets of the hypothesis which I tested. So, coming back to the point and not go beat around the bush, it will be inward and even long-term inward because we want to miss some opportunities to have focus. Focus is underrated. Opportunities are overrated, is our belief, right? Opportunity is there, but that comes at a cost of focus. And we want to master India as much as possible. And I think we are still scratching our surface. And if I told you some hypothesis I have tested, which I am surely going to put it on media, will surprise us. So yes, sir, always invert. So far, long term also invert. Great, great.

Good, good. Very happy to know that. And my second point was on the mutual fund. Mutual fund license application. Have we done something on those lines? Some media news are talking. So, we have applied for a mutual fund license, and if so, what are we thoughts around that?

Rajeshitar, how are you ready? We are ready, Rajeshitar. And, sir, Sunil sir, how can I ask you,

Rajai, this month and we applied for mutual fund license application. Okay. We are already in prison, almost data is prepared. So, mostly in the, up to 20th of October, we can file.

By this month-end, sir is expected to file. Sunil, sir, that's the confidence of Rajeshji. If Rajeshji has said anything, he doesn't do follow-up, so I am unaware. But he is as prepared as this month-end. Okay, whenever Rajeshji speaks, I feel very happy and excited because he is one person who has been in this company longer than half my product team was born. Okay, great. Okay, excuse me so much pride, because that's where finance is where maximum attention is needed so that you don't slip anywhere inadvertently as well. And thank you, Rajeshit. I'm using this platform to acknowledge this contribution to bring us thus far and further.

Sir, if I can just, you know, just more detail. See, essentially, we like the company with the reason that, you know, we are focused on the things that we do. So, we are taking care of the client wealth and we are investing into mutual funds. Managing money and the part of distributorship, you know, that's significantly different. What is required for a mutual fund would be more about investment mindset, etc. So, sir, I just wanted to understand, are we digressing from what we are great at? Just wanted to understand this piece, if it is possible to be shared on the platform.

Of course it is possible, sir. Transparency is the least my shareholder can expect, especially Sunil, sir, with added value to us by every question in all the 19-20 quarters. So, yes, so will we digress? The answer is no. Only a platform doesn't imply digression. What you do with the platform implies digression. I could have used Gip City to invest in Korea. Then it implies digression. Whatever we will do on the mutual fund platform, if somebody can do better, we are not an egoistic platform to try and do it ourselves. We will do something which is not me too whatsoever. If anything can be delegated, it has to be delegated. It is our principle. So why do I need to build a long-only ability when I have the stars in the country? What we will build It will, again, of course, unfold for people to see, but it's not going to be me too, for sure.

Fine, fine. Look forward to that interesting opportunity which will come with us going forward.

And I don't want to spill my beans too much, but I also, I don't want to spill my beans too much because I don't want any shareholder to extrapolate anything before the eggs are hatched. Don't count the chickens, they say, you know. So that's why I'm not expressing too much, but I'm so happy and excited for the fact that the group has decided an AMC inside this company. So my shareholder gets to participate of the IPO built here, which can also be executed on a mutual fund plan. I don't know whether I've been able to articulate that well enough. I was very excited to have that as a fully owned subsidiary of ARWL, which is 60%, 50%, 50% free float or even more.

Thanks for all this. All the best. And look forward to many more quarters of growth from the company. Thanks. All the best to each and one, everyone.

Keep working for the long-standing shareholders like yourself.

Thank you. The next question is from the line of Arun Gopal from Redtree. Please go ahead.

Yeah, good evening, and congratulations to you and your team for consistently performing, even in testing times. So, the question is, yes, I hope I'm clear.

Yes, Arun, sir, I can hear you very clearly.

Yeah, our assets have crossed around 1.08 lakh rows in MySol, which is good, which is an 18% growth year and year. Could you help the breakdown of how much of the growth is driven by the new money which inflows versus the market gains from the performing equity market? And what's the target for the net inflows if the market volatility increases in the coming quarter, coming half yearly?

Harun, sir. Namaste, sir. We have a target of 1.2 lakh crore for the year on the AUM by Okay, we have a target of generating net flows of 6,000, 7,000, 8,000 crores with God's grace for the residual yield. The mark-to-market so far has not contributed too much in the last quarter. Since our mutual funds delivered stupendous accessories, it has helped us keep the number 2,000 crores more from the last quarter end in spite of one of the worst quarters for Nifty. How much is Nifty, sir? Nifty fell last quarter by about 8%, 7%. One second, Vishal is checking. In spite of that, we brought in 4,000 crores. Ideally, if there was zero mark-to-market, we should have been at 1,10,000 crores. So, there is a 2,000 crores mark-to-market loss this quarter. Okay, so Nifty is down 5%, 5%. Our total overall assets would have fallen about 1,500. So, will we get to 1,20,000? Don't know. But will we get to the net flow of 3,000-4,000 crores for the next two quarters? We'll try our best. So, that will mean if we get some 2-3% mark to market, our most volatile guidance, which is AUM, because it depends on Trump, sir, and so many other external variables, is the most volatile one, unlike revenue and guidance, because AUM is captured on one single day, 30th September, 31st March. So, we have a target. Does it answer, Arun, sir?

Yeah, it does answer. Thank you very much.

Thank you, sir, for your question.

The next question is from the line of Ravi Shankar and Individual Investor. Please go ahead.

No, my question on ESOP was asked and answered by Theros Alden.

Thank you. The next question is from the line of Sunil from Diamond Asia. Please go ahead.

Good afternoon, sir. Thank you for the opportunity. I have two questions. Firstly, among the net flows, what would be a broad pickup between, let's say, your existing clients and new clients, if you could share? How do you look at it?

Yes, sir, I can tell you this intuitively. Of course, Vishalji will give precise numbers. How we look at it, sir, we don't push clients to start big. Okay, so generally, our 70% of the net sale is generally 60 to 70% will be existing clients. Because unlike other private wealth companies who will say start with 5 crores, we say start with 1 crore as long as you have 10 somewhere. I will prove my merit over a period. Of course, in bad times, it becomes difficult to prove to the initial clients, new clients. So, I am now conceptually wanting to answer, rather than mathematically, I will come to the mathematics of it. Conceptually, we've always, as a wealth management outfit, my boss has told me, be secure in your skin. Don't push them to start big. So, if I got some 200 clients last month or more than that, I would tell people start with 1 crore, 2 crore, no problem. So, if I get 1000 crores in that month, hypothetically, then I would get 75% from existing clients and 250 crores or the new my clients would be about 1 crore, 1.5 crore each. But we generally try and validate whether each of them have the money to give me. If they have 10 crores to give me, I will start with 1 crore, no problem. If I deserve it, you will give me. That's the hypothesis. Now, coming to the exact number for the last quarter, 62 is existing, 38 is new, sir.

Okay. Okay. Thank you, sir. Very helpful. Second, let's say if you look at your business from strategic lens for the next three, four years, so what are the key areas where you would like to focus on? So, let's say, you know, get deeper into existing clients' wallet share, or expand more geographically, or are you looking at new products? How do you look at a business system?

Sir, I'm, okay, let me, again, I might sound a little philosophical. We are only focused, only focused primarily. We are, obsessed is a bad word. We are, okay, let me use the word obsessed. We are obsessed with client outcomes. Everything else follows. So, now coming to, we are looking at how do we deliver 6%, 5% to 6% Jensen's Alpha to client. That's the sole-minded focus of 182 research people. Also, my relationship managers, they have to implement advice. That is when concepts translate into money into portfolios. So our sales fraternity, if you have to call them that, which I don't like to call them, the delivery engine, which is account managers and RMs, which is about 900 odd people, are focused on making sure that paper money becomes actual money. You don't have to walk up to a client and say, I told you so. That doesn't help the client, right? It just makes me feel good about it. Oh, I said this, sir, you didn't do, but I told you so. So, first, in the topic of what are we focusing on, if I went straight to your answer, it will be unfair to not tell you what we are obsessed about. We are obsessed about client outcomes. In the Gira and Raga environment, of course, my new clients may not be happy. They are saying, you know, I will make 10-15% and I will make 2%, 3%. Yes. Now, coming to what are we focusing on, we are focusing on all four engines. The first engine is client's performance. If clients make 12% this year, my revenue next year goes up by 12%. The second, which is what I touched upon, the second thing which we are focusing on is capacity utilization. Today, we have 431 relationship managers still having a capacity to handle 8,000 more clients. So, I am submitting to my existing clients to refer me to their friends if they think I will not be unfair to their friends. So, that's unutilized capacity. That's the second thing we are focusing on. Client are generously referring their friends, which is a win-win. Third, I am focusing on new plant and machinery or new capacity, which is our relationship managers. We are, for the future, which are our account managers, which is 500 people, some from IIM, some from CA background, some from now IIT, some from basic colleges, but intelligent, sharp, genuine human beings. The next 100 RMs are already identified and being trained to be promoted in the next one year, one and a half years, but we have some capacity constraint in terms of how many do we want to buy before we can choose. So that's the third leg of growth. And the fourth and the final leg of growth is the penetration into client's wallet, which is my fourth leg of growth. Existing assets, if there is mark-to-market, my revenue increases. Capacity utilization, capacity creation, and lastly, penetration. I, we may have more than 1 lakh crore plus with the same set of 14,000 families who are evaluating us at different stages of life. Somebody who has evaluated me for 10 years is a full sole advisory client. Like that. So, these are the four things we are focusing on. Performance, penetration, capacity building, and capacity use.

Very helpful, sir. Thank you. Thank you so much for your time.

Thank you for your kind questions, sir.

Thank you. The next question is from the line of Jyoti Khatti from Ambit World. Please go ahead.

Yeah, thanks for taking my question. So, just two questions from my end. Firstly, how the, if you can just, you know, brief us on how the MLDs work and how the IRR on this product has, you know, worked over the years in the bad and the good markets. And secondly, how you tap the ultra-H&I segment, you already did mention that you do conduct the events that help you to conduct the new clients. But apart from that, more into the fact that how do you tap ultra-H&I clients and how it is different versus peers.

Great. So firstly, structure products, how do they work? There's a lot of content on the secondary space. If you said Feroz Adi is explaining structure product, they will be there enough. But let me give you a sense of it. Structure product issuance requires some NBFC who is not very flamboyant with their NIMS. They have to keep the money safe. That's the first condition. And most NBFCs who issue structure products don't want to keep 50% in investments. Generally, an NBFC who issues structure products which has some derivative hedging to be needed has to have 50-60% of their money in a DMAT account. That's the first step to keep the money safe. Markets are markets. You need to have margin enough to hedge it correctly as per the Black Sholes pricing model. Then you embed their long-term derivatives depending on your Delta Gamma, Vega, Theta, Rose opinions. That's the second thing. Third, you have to backtest and get your outcomes such that your front test using Monte Carlo simulator should always supersede your backtest results. That's what, like most of the products which we have designed and launched from the last 14 years would have shown a probability of 90% of the victory, But actual transpired is 94-95%. That's where the Monte Carlo simulator needs to throw up. In the future, probabilities have to be greater than past probabilities. On that whole thing, you will design two things, right? So, we do the same product. The product I did in 2012.

Sir, to interrupt, Ms. Jyoti, may I request you please mute yourself while management is answering. There is a disturbance from your line. Thank you very much. Sir, you may please continue.

Yes. So how has been the output? Monte Carlo simulator, when we designed it, told us 94. It delivered 94% of maximum outcomes. Back tests are very short period of time. So we don't do part-dependent products. We do only end-dependent products. All our learnings, which I learned in ReliGear and Macquarie, when I started issuance, from 2016, six whatever mistakes I did became an embargo to not do here. And do the same product. Clients tell you to design customized structure products. We say, sir, you don't understand embedded derivatives. You don't understand option Greeks first order. So you will not customize. If you want to buy what I put on the table, buy it. Because for you to customize, you will have to run so many models. So unlike most wealth management outfits who are ready to design anything for anyone, we don't customize structure products. If somebody wants customization, then they need to understand option Greeks so deeply. Third order Greeks have to be understood. So what do we do in structure products? We embed derivatives which have a larger probability, not certainty of victory. That's why all the 1900 products approximately matured and not lost money in spite of they having matured, some of them having matured in COVID. So that's one. Second, how do we, we don't acquire ultra-HNI. We build ultra-HNI. That's the key difference. Today, newspapers can tell you who sold the biggest property, who sold the biggest business to a private equity guy, who did an IPO. Those information is available. So, most wealth management outfits go to those doors saying that I will do it in low cost. Come to me. So, we say we don't do it in low cost. If I don't deserve 1%, I don't want to be on that table. I will try and do my best to add value to you and earn my 1%. So, we don't go to ultra-IHNI straight unless he's my client's friend. We give that answer.

Yes, sir. Thanks. Thank you.

Thank you, Madam.

Thank you. The next question is from the line of Anish Bawar from Ventura Securities. Please go ahead.

Good afternoon, sir. Congratulations on a good set of numbers. I had a question that what are the primary and secondary issuances of MLDs for this quarter?

The primary for the quarter was 4,200. Sorry, sir. Primary on 73. 2,73. Total.

And secondary for the quarter is 7,50.

7,50 secondary, 2,000 odd in primary.

Okay. Thank you so much, sir.

Thank you, sir.

Thank you. The next question is from the Ryan of Anoush Kasha from A3 Capital. Please go ahead.

Hello. Hello, I'm on the phone.

Yes, sir.

Sir, there was a news article that the Serbian is preparing to give the portfolio managers also the mutual fund advisory services. So, any take on it, sir? Yes, sir.

I have actually, yeah, on this subject, I have spoken some time back that most people who surrendered their advisory license were using a PMS license to run a mutual fund portfolio. So basically, SEBI has regularized it by creating PMS where mutual funds can be bought. So I think in a mutual fund, a PMS platform is not so required because mutual funds, you don't transact every day. In stocks, you transact every day. In PMS, I don't know why only to charge a fee, a PMS becomes easier. Because if you are a registered investment advisor and you go and take a check from a bank account, it is not very easy. So I think registered investment advisors will find it very useful. Because if you put mutual funds in a platform and then charge them in terms of units with the power of autonomy, it becomes lesser emotional drain for an Indian to pay a fee. Especially during bad markets. So, does it have a huge merit for registered investment advisories to move into mutual fund PMS platform? The answer is yes. I don't see a reason why a client, especially in the S&I segment, needs to delegate a discretionary mandate to something which he transacts two times a year.

No, sir. I was just asking you to be competitive. It will not be competitive for us.

No, sir. No, sir. Not at all. Thank you, sir. Best of luck for the future. Thank you, sir.

Thank you. The next question is from the line of Saurabh Draviathan, an individual investor.

Please go ahead.

Hello, sir. Good afternoon.

Good afternoon, sir.

Congratulations on your numbers and also on the approval for a gift city operating, sir. And my question is, when do you think would that be become operational? And initially, how many funds are you planning to launch?

Vishal, sir, two. And in the next two, three months later, by the next quarter, I think we would be able to give them a good use. Yes, sir. In a couple of months, not too far. And two.

That was a great help.

Thank you, sir.

Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Mr. Feroz for closing comments.

Thank you, madam. I like to thank everyone for being a part of this call. We hope we have tried to answer your questions. If you need any more information, please feel free We need to reach out to Mr. Vishal Sangui, our beloved Investor Relationships Head, and Rajesh Sabuta, our beloved CFO, which, while wishing everyone a very happy Diwali in advance, because we're going to speak after Diwali, and hope the festive festival season brings joy and prosperity to one and all. Thank you to spend time on a Monday evening. Have a wonderful week.

Thank you. Thank you, everyone. On behalf of Anand Rathi Welt Ltd, that concludes this conference. Thank you for joining us, and you may now disconnect your lines. Thank you.