Ladies and gentlemen, good day, and welcome to the Q2 and H1 FY27 Earnings Conference
Call of Geojit Financial Services Limited. This conference call may contain forward-looking
statements about the company, which are based on the beliefs, opinions, and expectations of the
company as of the date of this call. These statements do not guarantee future performance and
may involve risks and uncertainties that are difficult to predict.
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 management’s opening remarks. Should you need
assistance during this conference call, please signal an operator by pressing star then zero on
your touch-tone phone. Please note that this conference is being recorded. I now hand the
conference over to Mr. Satish Menon, Executive Director, Geojit Financial Services Limited.
Thank you, and over to you, sir.
Satish Menon:
Thank you, operator. Good day, everyone, and thank you for joining for Geojit Financial
Services' Quarter Two and H1 FY27 Earnings Call. Joining me on the call today are Mr. C.J.
George, Executive Chairman; Mr. Jones George, Managing Director; Ms. Mini Nair, CFO; Mr.
Jayakrishnan Sasidharan, CIO; Mr. Rahul Roy Chowdhury, CEO of Private Wealth; and Mr.
Liju Johnson, Company Secretary.
I will begin with a brief overview of the operating environment and our business performance,
after which I will take you through the financial performance for the quarter and for the first half
of FY27. First is on the operating environment and the strategic direction. Of course, the second
quarter was marked by volatility and corrections in the index, Indian capital market, particularly
during the month of September. In this environment, our focus remained on maintaining
customer engagement, supporting disciplined investing, and continuing to build a diversified,
relationship-led wealth platform.
As on September end, we had a network of 529 offices compared to 525 in quarter one. Our
client base increased to INR 17.25 lakhs, and we added 61,657 clients in the half year. Our
recurring revenue business continued to build scale. Recurring revenue AUM reached INR
26,737 crores in H1, which is split across mutual fund, overseas AUM, Smartfolio, PMS, and
AIF. This is compared to INR 23,230 in the end of FY26.
Our lending book stood at INR 780 crores as of end of quarter two compared to INR 735 crores
year back. It consists of margin trading facility and loan against shares and mutual funds. These
businesses complement our core broking franchise and broaden the range of solutions available
to our clients. Recurring income in H1 is 40% of the total income, which has grown consistently
over the last few years. Just for comparison, recurring income was 25% of the total income in
FY23; now it is 40%.
Coming to the quarter two and half year performance. Revenue from operation in quarter two
was INR 165.82 crores, which is up 2.5% Y-o-Y and up 3.38% sequentially. EBITDA was 36.7,
while profit before tax stood at 20.62. For H1, revenue from operation increased by 6.72%, and
EBITDA stood at INR78.23 crores. The half-year performance reflects top-line resilience
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alongside higher operating cost and lower transaction-linked activity in the cash market. The
quarter’s performance reflects a combination of factors. Of course, subdued activity in the cash
market affected the transaction-linked income, while distribution income and growth in feeearning AUM provided support. We continue to invest in people, technology, and distribution
capabilities to strengthen customer acquisition, SIP mobilization, and service delivery. These
investments are intended to build capacity and improve productivity over time.
Employee benefit expense increased by INR 8.17 crores Y-o-Y. This increase was mainly
attributable to a higher sales personal headcount, recruitment for our DIFC subsidiary, and
expansion of the IT team to support the technology transformation program, and of course,
higher incentive in line with the growth of distribution business. In terms of customer assets and
gross inflows, customer assets stood at INR1.12 lakhs crores as of September end. Sequentially,
reported customer assets were broadly stable. Healthy gross inflows continued during the
quarter, but market correction, especially in the month of September, offset some of the
underlying inflows.
We believe it is important to distinguish between the flow of new investments into the platform
and market link changes in the valuation of existing assets. Gross inflows remain healthy
throughout our investment offerings, supported by healthy customer engagement and our
distribution network. While the market movements can affect quarter-end AUM, the underlying
inflow momentum and continued participation through SIP remain important indicators of
customer engagement. And we continue to strengthen our field force.
In the mutual fund distribution business, our SIP book reached INR 156 crores, and the number
of SIP clients is approximately INR1.78 lakhs. For the wealth management business, annual
ARR net flow, which comprises of net flows in mutual fund, third-party products, and insurance,
stood at INR 583 crores in quarter two. For H1, it stood at INR1,189 crores. These measures
provide an indication of net additions to recurring revenue link products.
They should be considered alongside gross inflows, redemptions, and market-related valuation
changes. Mutual fund AUM stood at INR18,449 crores, excluding the JV. We are continuing to
strengthen our field force capabilities and customer outreach to support our SIP acquisition and
deeper product engagement. 79% of our mutual fund income come from clients who have been
with us for 5 years and plus.
In terms of our asset management business, it continues to grow. PMS, AIF AUM stood at INR
2,018 crores as of September end, compared to INR 1,449 crores end of March, which is a
growth of 39% over March. Asset management net inflows increased to INR 322 crores in
quarter two compared to INR 71 crores in the same period last year. For the half year, asset
management inflows stood at INR 408 crores.
We view this improvement in net flows alongside the growth in AUM and client numbers as an
encouraging indicator of momentum of business for our asset management business. Within our
alternative investment offering, Geojit Yield Plus, Category III AIF, with an absolute return
strategy, had an AUM of INR 248 crores as of September end, compared to INR 22 crores a year
back. In insurance business, we recorded a gross premium of INR 175 crores in quarter two.
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Insurance remains an important part of our broader wealth proposition and supports cross-selling
and deeper client relationship.
In the GCC, we continue to engage with NRI clients amid evolving investment preferences and
a wait-and-watch environment. We have observed that attractive FCNR deposit offering and
market conditions were influencing the allocation of investment across products. Rupee
movement and global investment opportunities have also shaped client preferences, including
interest rates in the US. We have not noticed any major redemptions in our overseas market. We
continue to monitor client activity and market sentiments while maintaining our focus on
customer engagement.
Technology remains a key enabler for our transformation. We are investing in our platforms and
IT capabilities to improve the client journey, supporting digital onboarding, and strengthening
our analytics and operational efficiency. To conclude, quarter two FY27 was a challenging
quarter for the capital market. Nevertheless, we continue to see healthy inflows, growth in
recurring revenue AUM, and a significant improvement in asset management net flows. Of
course, market link valuation movement affected the reported customer assets, along with
subdued cash market activity.
Our priorities remain to deepen customer relationship, expand SIP and product penetration, and
continue to invest in technology. We believe that a broader recurring revenue base, supported
by our distribution network and client relationship, will help us build a more resilient and
scalable business over the long term. With that, I would like to thank you for your continued
interest in Geojit. Thank you very much. Over to operator for Q&A.
Moderator:
Thank you. The first question is from the line of Daksh Prashar from Desvelado Research. Please
go ahead.
Daksh Prashar:
Hi, sir. Am I audible?
Moderator:
Yes, you are audible.
Daksh Prashar:
Okay, sir. So my first question is, sir, given that only a small percentage of our active clients
hold more than one product, what specific cross-selling strategies are being deployed to increase
product penetration across our existing client base? That's my first question, sir.
Satish Menon:
Okay. So we have close to 20% of our clients who have invested through us in more than one
product. And primarily that is brokerage and mutual fund, which is the overlapping one. We
have right now penetrated less than 5% of our clients for life insurance and less than 3% for
health insurance. Our first focus, of course, is to penetrate more in mutual funds, and then we
have a lot of scope to do in both insurance, life as well as in health.
Daksh Prashar:
Okay. All right, sir. That's really helpful. And, sir, my second question is about ARR. Sir, ARR
this quarter was around INR 322 crores against INR 71 crores a year ago. Were there a few large
sum investments or was it broad-based retail inflows?
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Satish Menon:
No, it is primarily broad-based. Though we have few high tickets, but I would like to take you
towards our AUM. When we look at our PMS, we cater to the lower segment of HNI in that
matter in terms of portfolio per client. For PMS, when we look at INR 1,750-odd crores, the
average size of a client would be INR 75-odd lakhs.
Daksh Prashar:
All right, sir. That's really helpful. And, sir, just my last question. How much AUM do we expect
from the DIFC and Barjeel AMC to add in the second half of this year?
Satish Menon:
We do not give any forward-looking statement. DIFC is still in a very nascent stage, so it may
take time. Nonetheless, we don't give any forward-looking statement, sir.
Daksh Prashar:
All right, sir. Thank you so much. That's it from my end. And congratulations on this set of
numbers.
Moderator:
Thank you. Next question is from the line of Dhaval Pandya from Areeza India, please go ahead.
Dhaval Pandya:
Hello. Am I audible?
Moderator:
Yes, you are.
Dhaval Pandya:
Hello, good afternoon, sir. First of all, congratulations on a good set of numbers. I had a couple
of questions. So, the revenue grew year profitability was low. What were the main drivers of the
decline in bottom line for Q2 and H1? Hello?
Satish Menon:
Yes. I would request Chairman to answer this.
C. J. George:
Sorry. Can you please repeat the question?
Dhaval Pandya:
So, your revenue grew year-on-year, but the bottom line did not grow as per the revenue grew.
So what was the main reason behind it?
C. J. George:
We had in the past also reiterated that the beginning of this year onwards, we have been investing
heavily in terms of technology for technology transformation as well as investment in
cybersecurity, etcetera. This will this also resulted in hiring more number of technology
resources, competent, senior leadership technology resources. Also, we have been hiring people
in the field level for better reach as far as the customer engagement is concerned.
So, these were part of the well-thought-out strategy. What impacted was basically the market.
So, this hiring in both technology as well as in the field, that also resulted in increase in inflows,
gross inflows for us. So, this was a part of well thought-out strategy, and we had in the past also
indicated that the hiring that is happening with regard to retail sales force as well as the
technology transformation investment that we are making, this is basically to service the clients
much better going forward.
So, this is not unexpected. Although today, with regard to hiring sales force, etcetera, it will be
relatively muted going forward looking at the market situation as well as the emerging
geopolitical situation. So, this is the reason why the expenditure went up largely.
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Dhaval Pandya:
Okay. So, assuming that the geopolitical situation continues and this Middle Eastern war and all
continues, what are your measures to outcome this kind of situations? Because we have seen it
in last month that such disruptions has come in the equity markets. So, what is your thought on
it, and how will you see to it that your things won't get affected much?
C. J. George:
We will focus on increasing the productivity of our field force rather than hiring more number
of people in this kind of market. To be frank, the recurring income-based products has been our
focus area. We will continue to focus on that and increase the cross-sell opportunities within our
customer base.
Fortunately for us, we have not reached any significant percentage in terms of full potential with
regard to the customer base. And our customers are largely long-term clients, second-generation
clients even, so the customer stickiness is also very high. So, this is what we are going to do if
the market is turning out to be, particularly geopolitical situation turning out to be risky or
challenging going forward.
Dhaval Pandya:
Okay. And looking at current revenue contribution by the recurring business is 40% in H1 of
FY27, so how do we look at in the coming years, like in next 3 years to 5 years? How do we
look at it? Like increasing or staying stagnant in this range only? How do you look at it?
C. J. George:
No, our plan is to significantly increase the recurring revenue income. This will eventually take
care of the cyclicality risk as far as our cash flows are concerned. So, this is part of a long-term
strategy that we have built in. So, there is no kind of compromise on that. And also, I must tell
you that this is not a short-term strategy on the basis of the geopolitical emerging trends, etcetera.
This we have started sometime ago, and we continue to focus in that line.
Dhaval Pandya:
Okay. That's it from my side as of now. If I have any further questions, I'll join back the queue.
Thank you very much, sir, for answering all the questions.
C. J. George:
Thank you.
Moderator:
Thank you. Next question is from the line of Jyothish Vijayan from Motilal Oswal. Please go
ahead. Mr. Vijayan, your line is unmuted. You may please go ahead with the question. Due to
no response, we will take the next question. Next question is from the line of Arvind Singh from
Maitrayee Investment. Please go ahead.
Arvind Singh:
Hello, am I audible?
Moderator:
You're audible.
Arvind Singh:
Hi, sir. So, my first question is that customer assets were broadly stable at INR1.12 lakh crores
despite healthy gross inflow. How much of the movement reflected mark MTM changes versus
new client inflows? Can you shed a light on this?
Satish Menon:
So, INR 1 lakh crores is a huge base. If you see September itself, you saw the market going
down by 6%. Whereas net inflows, we have already given the numbers in our presentation. So,
when you look at the inflows, inflows for the first half would be INR1,400-odd crores plus . But
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October 26, 2026
INR1,400 crores is only 1.4% of INR1 lakh crores. So, it is primarily because of the market
volatility and subdued depreciation in the market where you see that customer assets remain
more or less at the same level.
Arvind Singh:
Okay. And, sir, we are heavily investing in the human resources, so employee costs are
increasing. So, can you throw some light on like how we are planning to manage human
resources or the employee base?
Satish Menon:
Yes. Okay. Before I answer this question, just an addition to my answer to the last question. I
would just like to give you some data. Even looking at mutual fund, in September beginning or
August end, our mutual fund AUM had actually touched INR 20,000 crores. And when you look
at September, and it has become INR 18,500 crores. So that itself, though you have we had
positive inflows, from that itself you will come to know that how the market has affected.
So, when we talk about mutual fund inflow, that is the actual inflow, actual AUM, which gives
us a recurring revenue. So that is how the impact has compared to August end or September
beginning to September end. In terms of employee, I think the Chairman already mentioned.
With the market being such, the capital market and the cash market delivery volumes being
subdued, we'll be very cautious in terms of in terms of aggressively increasing the employee
count. Our main focus right now is to improve the productivity of the existing employees and
having a close look at the cost incurred on these employees.
When the market sentiment improves, when the cash market when the brokerage market
improves, we can again go back and look at expansion in the terms of employees. But as of now,
we will be cautious, and we will be only selectively increasing the employees. The core idea is
to improve the productivity of the existing people rather than going out-all to increase the
headcount.
Arvind Singh:
Okay. Fair, fair, sir. And all the best for your future.
Satish Menon:
Thank you.
Arvind Singh:
Thank you, sir.
Moderator:
Thank you. Next question is from the line of Yash Parkar from Patel Investments. Please go
ahead.
Yash Parkar:
Hi, sir. Thank you so much for the opportunity. Am I audible?
Satish Menon:
Yes, you are.
Yash Parkar:
Right. So, sir, what measurable benefits should investors expect from technology investments,
such as improved client conversion or lower sourcing costs? And over what time frame should
we look at those benefits?
Satish Menon:
I would request Jay, CIO, to take this question.
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Jayakrishnan Sasidharan: Thank you. So, the early areas that we have started out are around customer onboarding. And
we see advantage, one, in terms of customers getting converted from the time they start their
journey. So, we have seen a 15% uptick in the speed at which they convert and also the final
closure. So, that is something that we are seeing as an improvement.
The other area that we are looking at, I think you alluded to that question on internal operations
on email efficiencies and things like that. So there we have actually driven a lot more focus
around customer support and customer success, where we are able to look at high-priority areas
much faster with the help of technology and to a certain extent leveraging AI as well. So,
customer support is a big focus area from that perspective.
Coverage of number of tickets, number of responses, all of that have increased dramatically. So,
automation within our operations, improving customer onboarding, automation at all of those
levels have really increased our ability to support customer onboarding.
We also have enabled dealer-assisted order creation for mutual funds and insurance orders.
Those are completely technology-enabled. We've leveraged newer channels. We're bringing in
newer channels like WhatsApp as well into that. So, along with our existing channels, we are
also bringing in some of these new channels where customers can have multiple ways to engage
with us and put in their requests for orders.
Yash Parkar:
Right. And, sir, how are the NRI investment preferences, FCNR deposit offerings, and currency
movements and global opportunities affecting activity across the GCC business?
Jones George:
Hi. This is Jones George. So the FCNR, most of the Indian banks did a fantastic job in raising
funds from NRIs. And the investment returns were very lucrative such that the equity returns or
the level of risk for equity was not comparable. So, we had a lot of challenge in being able to
compete with the FCNR product. But subsequent to the closure in August, we have started seeing
some bit of inflows.
However, the current geopolitical situation in GCC has put people in a wait-and-watch mode.
Along with that, the currency depreciation has also impacted their decision-making. So,
whatever investments today that they are considering is, they're largely looking at a dollardenominated investment portfolio to hedge that risk. However, we have not seen significant
redemption pressure, so which means they're still patiently waiting for markets to improve.
Yash Parkar:
Right. Sir, last question from my end. What are the top priorities for the second half of this year
that the management has set? And what indicators should the investors monitor to assess
progress on growth, on profitability, or any other operating metrics?
C. J. George:
I will take this question. I'm C. J. George here. So second half, we will focus on increase in
productivity. As I told in the beginning of the conference, and Mr. Menon had told you, that the
cross-selling opportunity that we are taking advantage is only minimum at this stage. We intend
to expand aggressively and increase the focus on cross-selling so that the productivity increase
can come within the customer base itself if there are challenges.
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So, depending on the evolution of the market, we will make some changes. But the whole focus
will be how to increase the productivity of the people that we have, and the focus area will be to
increase the cross-selling -- to expand on cross-selling opportunities. So, I'm not venturing into
giving any numbers to you, but this will be our focus. Thank you.
Yash Parkar:
Right, sir. Makes sense. Thank you so much for patiently answering my questions.
Moderator:
Thank you. Next question is from the line of Manaswini from Oracle Investments. Please go
ahead.
Manaswini:
Hello, sir. My first question is EBITDA margins have declined compared with the corresponding
period last year. What would you say are the most important drivers for improving margins,
especially as now the business scales?
Satish Menon:
I think I already answered that. When you look at the split, the income has marginally increased
by 2-odd percentage, whereas the expenses have gone up. And we also mentioned that the
expenditure is primarily coming from employee cost and the transformation project for IT.
Going ahead also, so we had said this sometime back, some quarters back, that our focus is to
increase our recurring revenue asset so that we are able to predict what kind of income will come
in year-on-year.
The focus continues that. In terms of expenditure, our EBITDA margin, when you say that, there
is a big component till today also which comes from the broking segment, that is the transactionled business. As you know, the last 3 months, 6 months, or more than that, the business in capital
market broking has been slightly subdued. And if it remains like this, EBITDA margin for the
next one, two quarters also looks to be subdued for us. But you never know, and that the
sentiments in the market changes.
If you look at the history of Geojit or in the history of the industry, you might see a 1-year or 2year lag or subdued capital market, post-rate it jumps up. So, in terms of our present focus, we
are looking at increasing our recurring revenue asset. And that is how it is going to be. In terms
of EBITDA, we will try to increase the productivity of the people so that EBITDA increases.
Rest is on the capital market activity. History will tell us when the capital market activity
improves, EBITDA margin also improves.
Manaswini:
Okay. Thank you, sir. I joined a bit late, hence might have missed that. Another question that I
had is what is management's outlook for, say, transaction-based income, especially given the
market's volatility, competitive pricing, and even changes in retail participation? What would be
our transaction-based income outlook?
Satish Menon:
So, to take you back to history, till 2016, we were only a stockbroker, and a large percentage of
our revenue used to come only from transaction-based income.
Manaswini:
Yes.
Satish Menon:
Even in those times, we have always focused on long-term delivery business in the capital
market. When we look at Geojit capital market business, of our cash market volumes, 50% or
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October 26, 2026
plus is delivery business. And if you look at the split between equities and derivatives, in terms
of income, derivatives constitutes around 20% of the total income, 80% comes from cash, of
which 90% comes from delivery business.
So, we have been conscious from the start of the company that we will be looking at long-term
wealth creation in the capital market, and we will not push or force our clients to do day trading
or F&O, because even before SEBI came out with a report, we understood that when people do
leveraged trading, whether it is day trading or F&O, most of them tend to lose money.
So from the start, our objective has been to build long-term wealth for the client and focus mostly
on delivery business in the transaction-led segment.
Manaswini:
Okay. Thank you, sir. That sounds quite positive. One last question that I had was the monthly
SIP book has reached about INR156 crores. So then what is the plan to grow SIP mobilization
and increase penetration within our existing client base?
Satish Menon:
So it has grown to INR156 crores. And from what I understand, we are growing quite fast
compared to the industry. And like I said in my remark, we have 1.78 lakh clients who have SIP
running with us. We still have a huge segment to be still tapped for SIP. And that is what the
Chairman said, our objective in the coming quarters would be to increase our recurring inflows
through mutual fund, which will be ideally done through SIPs.
So we have been doing SIPs for the last 10-odd years now. And when I when I spoke about our
mutual fund client base, a healthy percentage, 70%, 78% of our clients who are with us in mutual
fund are more than 5 years plus. And these are primarily these are primarily coming through
SIPs.
Manaswini:
Okay. Thank you, sir. That's all of my questions.
Moderator:
Thank you. We will take our next question from the line of Vansh Rathod from JJ Advisory.
Please go ahead.
Vansh Rathod:
Hello. Good evening to everyone. Sir, I wanted to ask this quarter, the second quarter, we had
an insurance gross premium of around INR175 crores, if I am not wrong. So what are the exact
steps that we are planning as a company to expand our distribution network and increase our
existing clientele and boost revenue rates? Yes, that's the first question.
Satish Menon:
So like I said a few minutes back, in terms of life and health, we have not even penetrated 5%
or 3% respectively in terms of number of clients. We continue our cross-selling objective. So in
terms of the products available to our employees to sell, fortunately, insurance is a product which
doesn't have a direct bearing on the capital market.
So some portion of the sentiments which affects the capital market doesn't affect the insurance
business. More than that, since we have only penetrated less than 5% of our total clients for
insurance, we will continue to do continue to approach these clients for cross-selling without
giving any future number, sir.
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Vansh Rathod:
Got it, sir. Sir, I had one last question. So how is the management balancing capital allocation
between tech upgrades, hiring, and opening new branches, or and for that matter, returning cash
to shareholders? So how are we doing that?
C. J. George:
Thank you. I am C. J. George here. I will take that question. Technology investments are must
investments that we are undertaking at this stage. In order to gain market edge in terms of the
technology platform as well as the features and products that we have, we need to make
investments, and some of the legacy investments are being replaced to gain competitive edge in
the market. So this is something we are making as a as an imperative kind of a requirement.
With regard to new branches and additional people, etcetera., new branches, I must tell you that
we are not expanding aggressively, in this kind of market situation. At the same time, you need
to remember that our branches are predominantly, in the Tier 2, Tier 3 types of places where the
cost is relatively less and our ability to wait is also relatively high. So we are certainly very
conscious of the fact that capital allocation has to be very carefully planned.
To answer your next question with regard to returning to shareholders, etcetera, at the
appropriate moment. depending on some of these strategic opportunities that we are seeing,
particularly in this market. We will wait in terms of taking a decision, or rather jumping into a
decision of giving cash back to shareholders. We are getting some we are seeing some
opportunities strategically. And if that doesn't materialize, then we will of course look at the
opportunity of buyback etcetera.
Vansh Rathod:
Got it, sir.
C. J. George:
Thank you.
Vansh Rathod:
Sir, are we looking for any international ventures?
C. J. George:
No, not at the moment.
Vansh Rathod:
Not as of now.
C. J. George:
Not at the moment, except for except for -- we had we had planned a small investment in Bahrain,
which was announced, and this was -- which is not a very big investment. Other than that, there
is no international investment planned at this stage.
Vansh Rathod:
We wouldn't mind if there's an opportunity coming up, right?
C. J. George:
We are not looking at. We are seeing opportunities in the country itself. There are a lot of
opportunities in the domestic business. And particularly, difficult times are also good when your
balance sheet is strong and where there are good opportunities. Domestic market is currently at
the appropriate time.
Vansh Rathod:
Got it, sir. Thank you so much, and all the best, sir. Thank you for answering my questions.
C. J. George:
Thank you.
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Moderator:
Thank you. Next question is from the line of Vini Jain from Jain Investment. Please go ahead.
Vini Jain:
Hello, good evening, sir. So, I have a couple of questions. The first being, your combined PMS
and AIF AUM stood at around INR2000 crores, including a standalone PMS AUM of INR1,770
crores. So, what drove the growth, and what is the medium-term ambition for this specific
business?
Satish Menon:
So even if you look at the PMS business, PMS business has grown from INR1,450 crores to
INR1,700-plus crores. AIF, of course, is a new product from our side, which has grown from
INR22 crores last year to INR248 crores. We continue to focus on the asset management
business. You understand that we service clients with wealth and a section of our clients are HNI
clients. where they have the appetite to invest in PMS and AIF.
So, we have -- it is one of the main products for us in terms of mutual against mutual fund. So,
for focus for the asset management business is to grow that business, not only in terms of crossselling, but also in terms of getting new clients from outside. When you talk about AIF, in terms
of AIF, it is one of the best-performing Cat III AIF in the country, which is also used by our
wealth management team to get inroads into new HNI clients with this product.
Vini Jain:
Got it. So, in context to your asset management business, the income was around INR 9.83 crores
in Q2 and INR 18.4 crores in H1. So then here, what drives the conversion of the AUM and the
net inflows into the income? And then what would be your operating leverage that would become
more visible?
Satish Menon:
I'm sorry, you will need to repeat. I have not clearly understood your question.
Vini Jain:
So, my question to you is the conversion of the AUM and net flows into the operating income,
correct? So, when could the operating leverage become more visible to us?
Satish Menon:
Okay. So, in terms of the asset management business, since more than 90%, 95% of the inflows
come from the group itself, it is a highly profitable business for us. As of now, we are at INR
2,000 crores. On INR 2,000 crores and INR18 crores of top line for the half with a direct cost
which is not so significant. So, profitability you are already seeing as a part of the consolidated
accounts.
But going ahead, we intend to grow this aggressively. Going ahead, we will be looking at
empanelling third-party distributors also, were, though you will get the scale, the EBITDA
percentage of this particular business might come down a little bit. But as of now, since it is
there is no distribution fees to be paid to a distributor, this is a highly profitable business for us.
Vini Jain:
Got it. So, my last question to you is what progress has the DIFC platform made since the launch
in terms of client acquisitions and asset and revenue contribution per se?
Jones George:
Rahul, you want to take that?
Rahul Roy Chowdhury:
Yes, Jones. I can take that. Hi, this is Rahul Roy Chowdhury. So DIFC, as Satish also mentioned
sometime back, we started operations only couple of quarters back. As a process, DIFC is a very
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Geojit Financial Services Limited
October 26, 2026
well-regulated entity, and any account opening or any kind of business over there takes some bit
of lag time. We have already made inroads into around 50-odd relationships from India and
GCC.
These are all accredited investors of USD1 million plus, and a lot of interest has already started
developing as far as the offerings that are there from DIFC for our customers. This not only
helps us get new business in dollar terms, which is very much requirement for the HNI and ultraHNI space, but this also helps us acquire a lot of customers in India when we provide that service
to our customers.
So as of now, the revenue contribution from DIFC is not meaningful enough, but when I look at
it from a long-term point of view, it is going to add a very significant value in order to acquire
clients and grow business, both in India and in Dubai.
Jones George:
Just to add, the DIFC entity, we've booked an AUM of about USD 2 million so far.
Vini Jain:
Got it. That sounds nice. Thank you. Those are all my questions.
Moderator:
Thank you. We will take the last question from the line of Shravan Modi from Syndicate Family
Office. Please go ahead.
Shravan Modi:
Good afternoon, everyone. Thank you so much for the opportunity. My question is regarding, if
you see the ARR net flows across distribution products were very strong in H1. So which product
categories have contributed most, and how sensitive is recurring income to market levels versus
net inflows?
Satish Menon:
So, in terms of recurring revenue inflows, a large portion has come through mutual fund. So, if
you look at first half of the financial year, around INR 400-odd crores has come in the asset
management business, balance has come primarily through mutual fund. Unlike the transactionled brokerage business, a subdued market doesn't impact the recurring income so much.
So, when I compared the mutual fund AUM, end August or beginning of September, it was INR
20,000 crores, and we ended September close to INR 18,500 crores, you would see that the
income is not much affected. Unless and until you see you a 20%, 30% drop in the total market,
you might not see any major impact in the recurring revenue business, because the income is a
percentage of the AUM.
And AUM, since it is broad, it is spread across so many mutual funds, which is spread across so
many stocks, when the market that goes down by 6%, even if the AUM goes down by 6%, the
percentage of the income which goes down will be logically only 6%. But whereas in the capital
market, when the market goes down by 6%, 7%, the volumes might go down by 30%, 40%. So
that is how we started the call.
We continue to invest to increase our ARR AUM so that going ahead, also people will be -- or
we would be able to forecast what kind of consistent revenue this Geojit can get.
Shravan Modi:
Right, sir.
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Geojit Financial Services Limited
October 26, 2026
Satish Menon:
Did I answer your question?
Shravan Modi:
Yes, sir. For sure. Thank you so much, sir, for your detailed inputs. That's it from my end, and
wish you all the best.
Satish Menon:
Thank you.
Moderator:
Thank you. Ladies and gentlemen, that concludes our question-and-answer session. I now hand
the conference over to Mr. Jones George for his closing comments. Over to you, sir.
Jones George:
Yes. So, thank you very much, everyone, for joining our quarter two FY27 earnings call. As Mr.
Menon mentioned earlier, we continue to see healthy inflows, and our focus will be on enhancing
the annual recurring revenue-based business. Until we see stability in the GCC markets or
geopolitical or the global geopolitical situation, there will be some pressures in the NRI business,
but nevertheless, we will focus on the AUM-based business across all of our client categories.
So, thank you. Thank you very much for joining this earnings call.
Moderator:
Thank you very much. On behalf of Geojit Financial Services Limited, that concludes this
conference. Thank you all for joining us today, and you may now disconnect your lines.
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