Nuvama Wealth Management Limited (NUVAMA) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to the Noobama Wealth Management Limited Q4 and FY26 earnings conference call. As a reminder, all participant clients 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 this conference, 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. Ashish Teher, MD and CEO, for his opening remarks. Thank you, and over to you, sir.

Thank you. Good afternoon, everyone, and thank you once again for joining this call. It's a pleasure to speak with you all again. As usual, I am joined by Bharat, our group CFO, SGA team, and our investor relations advisor. We will quickly cover the company performance for the quarter and the financial year and share some key updates and the progress around our priorities. And then following both mine and Bharat's remarks, we can jump into FAQ. Just summarizing the result, I think it was really an interesting year for everyone. It started with the whole tariff drama and ended with the war, and I think many things happened in between. For us, it was a complete test of resilience this year. We navigated multiple moving parts, including something specific for us. And overall macro uncertainty. I think before we go into details, I'd like to take this opportunity to thank the entire Novama team and our clients for helping us navigate this time and, you know, emerge with a growth here even in these times. Looking at our specific businesses, Wealth Management continues to grow. Overall, Wealth Management is a cluster. I think both the segments are showing a very, very healthy momentum. Asset management build-out is progressing steadily. I don't think that business one should rush in because one bad performance year can have years of negative impact, and I think we are building out steadily. Asset services was an important monitorable for us this year, specifically after what happened at the end of Q1, and I am pleased to state that business has recovered fully and performed ahead of our expectations. Capital market remained broadly aligned and witnessed some moderation this year. Overall revenues for the year was closer to 3100 and operating profit after tax was about 1050. More importantly raised by profits from wealth. So composition of profits changed. Profits from wealth grew by about 23% and despite challenges, profit from asset services was around 14% year on year. A bit on market outlook and some industry trends, as we have always maintained and we continue to maintain that organized wealth management represents a multi-year structural opportunity. We still believe the same industries in early stages. Some consolidation of course will happen because large number of players are coming in, like what happened with let's say private banking or NBFC over the last three decades. But I think over time, few scale players with fully diversified multi-product platforms will scale as long-term leaders and there will be a long tail. And this is representative of what happens in wealth management globally also. A few themes which are emerging across the industry, I think private equity interest in the industry is all-time high. There is early signs of consolidation within asset management, specifically in mutual funds. We have seen some transactions that are happening in the market where the smaller AMCs which have spent some time and is not fitting into the strategic priorities of the promoters are, you know, moving into stronger hands. And there is a growing preference for full-stack platform. So there will be a few niche Thank you, everyone, and welcome to the Q&A, the Q&A, the Q&A, the Q&A, the Q&A, the Q&A, the Q&A, Several global platforms which we have seen in the past have transitioned from a stage of infancy to this mature multi-product stage and I think India will move much faster than that. Coming to our business highlights, starting with Nuwama Wealth, our focus area is Managed Products and Investment Solutions or MPIS as we call it. It continues to be a core growth engine for Novama wealth, almost full revenue growth. So, this year has been contributed by this product sub-segment. The revenue stream, as I have alluded in the past, is a combination of managed products, which is AIS, PMS, MS, which are all annuity-bearing, and other investment products, which is fixed income, MLDs, insurance, etc., which are non-annuity-bearing. Total MPI's revenue for the quarter now stands around 150 crores. This year, NPI's revenue has grown by about 38% on a full year basis. Assets have grown by 32%. Next flows have grown by 38% representing about 30% over the opening assets. I think it's a very, very robust and healthy growth we've been able to achieve. Lending, if you recollect, over the past 2-3 quarters, we've been talking about this, that we will increase focus, and it's now visible in the loan book. The loan book has grown by about 27% for the full year basis, and closing books stood at about 4,900, almost 1,000 crores higher than the average book. And NII continues to contribute about 22% of the revenue. There is some upside still there in this. Net interest income for the year did not grow in line with the loan book and that is very, very specific because once Whichever quarter or whichever time your loan book suddenly increases, there is an ECL provisioning that comes in, which is basis RBI, and in the next quarter onwards, that gets normalized and the NII picks up. And second, in Q4, there was a specific phenomenon of extreme volatility in the market because of the West Asia crisis. This basically leads to a behavior in our ESOP book where people don't sell. They exercise, but they don't sell because they wait for the prices to come back. And what happens to us is when they sell, our processing fees recognition gets accelerated. Because otherwise the processing fees is over the life of the loan, which theoretically is one year, but behaviorally these loans don't last more than three months. So, I think once the markets are now back, so in Q1, we should see some acceleration of processing fees. So, there could be a quarter of, you know, lag between the loan growth and NII growth, but eventually, if you look at 12-month rolling, it will catch up. Coming to the RM franchise. I think the mandate here was what we are calling seniorization of the team because the quality of clients also are gradually improving. Last one, one and a half years we spent on that. A significant part of the team has now become senior as compared to what we were about two years back. On a net basis, we added about three relationship managers in this cohort. And when I talk about productivity later, you will actually see the impact of this happening. A lot of work is happening on technology and AI frontiers. Foundational work is done. We are now implementing, implemented solutions for relationship managers across their value chain, which is acquisition, portfolio advisory, rebalancing. We have seen the productivity improvement which is flowing through because of usage of these tools. Earlier, we were restricting the tools only to training, which is now fully functional, rolled out. Now, we have moved into advisory also. So, we have seen about a 25% per RM revenue jump. In this segment, and I think a large portion also comes through the usage of AI, which to my mind will continue in future. On the solution side, we've added something unique in this segment. We've launched a service called Viratap. This is nothing but a... But a full-fledged estate and legacy planning tool for the clients in this segment. Earlier this was, you know, thought to be a product which is needed more in the ultra-high network segment, but I think even clients in the H&I segment now are now not only, you know, they've come to money, but they also have reasonable amount of complexity because Most of them will have children studying overseas, planning to settle overseas. So you need to now have a structure which helps them transition the assets in a more tax-efficient manner, considering that now there is offshore exposure also. I think Velasap is launched, and we are very, very excited about this product. Moving on to Novama Private, this segment also continues to witness a solid healthy growth momentum, starting with again product ARR. The revenue stream here consistently has grown by about 25-30% over the past few years, and now steadily contributes about 60% of our revenue. Here are assets about 54,000 and yields are nearly between 85 basis points to 1%. This quarter being 1%. I have always maintained that quarter to quarter, 10-15 basis points can move, but on an average, we should end up somewhere around 90-95 basis points. Net flows continue to remain strong, about 22% of opening assets in line with our full year guidance. Even year-on-year, if I remove the 170 flora chain last year, which was related to an M&A deal, we've grown the absolute value 20% worldwide. Alongside growth in distribution assets, we've also seen expansion in our in-house advisory solutions. We now have a full-fledged non-discretionary, discretionary TMS. We have advisory, we have structuring pricing. That will all give an impetus to ARR growth in the future. Coming to lending, here also lending has been in focus, but even now it only contributes 10-12% of the revenue. There is scope to go up to 20-25% over the next few years. On the RM side here, just to give you a brief snapshot, over the last four years, Amidst this entire competition, noise, multiple players coming in, we've been able to add about 60% of our capacity. We've moved from 90 to about 150 now. We will continue to onboard talent selectively, and we have a stated compensation philosophy that is not only performance-oriented, it rewards on merit, progressively increases as people perform better, But it's extremely transparent and aligned with long-term value creation. I think I wanted to leave a word of caution here for people that we've witnessed over the last 12-15 months. Large number of new players are, you know, making lofty promises to RLs of future valuations which seem extremely stratospheric to us and no visible monetization signs. I just want everybody to be, you know, thorough in their decisions before making any such plans. Because of the last decade, we've seen only 2-3 platforms where people have actually realized values. Reps have either remained on paper or never realized. And in the process, unfortunately, many careers have been damaged. I think here also we continue to, in Moama private also, I think we continue to invest a lot in our tech and AI. We've launched Agentic AI which basically works alongside the RMs in doing again portfolio analytics, performance tracking, product insight, and again here we've seen a productivity jump about 10-15% revenue per RM. We have also launched an industry first multi-currency module on portfolio reporting. Basically, we maintain in the past that clients are increasingly allocating to offshore, and if the Indian market, you know, gave one or two years of Well... Somewhat tepid performance, this has happened recently. That phenomena will only accelerate. And with that happening, you will need technology to support a multi-country, multi-currency portfolio for clients to review, rebalance, and basically, over a period of time, have control over the portfolio. Moving to asset management. As I said in the beginning that we continue to steadily build. I'll start with commercial real estate. Commercial real estate has been extremely successful this year. We've closed, I think right now the full fund is closed at about 4,000 crores. But as of end of quarter four, we were about 3,800. We've finished acquisition of three marquee assets, about 3.8 million square feet. About 20 to 50% of our funds are deployed. Once we start, I think 70%, we will launch a new fund. We are working on the thesis of the new fund. I think second half of this year is where we should look to launch. Again, the target should be anywhere between 3,500 pros, part of which, of course, will come in this year. Free IPO of private equity, which is our oldest strategy in some time. We started to exit our first fund, Crossover 3, and we launched a new fund, Crossover 4, which basically should be alive, the fundraise should be alive for the next maybe 6 to 10 months, and we should target to raise 1,500 crores there. We send them the leadership team here, we've hired the... Aditya Arora is the CIO. He has more than two decades of experience in private market investing across forms. I've been talking about private credit as a strategy. Happy to state that we now have the CIO in place, Amit Kamsar. He joins us from Aditya Bidla, that was his last assignment. It has 25 years of experience in credit across. We are right now building the team and we expect to launch our first fund. I think by end of Q2, again, maybe target about 1,200 crores or 1,500 crores is the first fund. Some part of it will come in this year. Credit, I think, is an important expansion of the platform because not only does it augment asset management and, you know, takes us towards more exhaustive bouquet, but it also helps a lot in giving syndication transactions for our wealth clients and wealth clients. Coming to the public market, I think the year was extremely volatile. It was in line with what the industry saw, at least in the H&I, Ultra-H&I segment, incremental allocation to equities did not come. We got gross flows, but we also saw redemption. So on our net basis, we are nearly flat. Hopefully now, once the market bottoms and there is recovery, we should be able to see that. But the key element here is we are... We are in the process of getting the MF license. A final inspection has happened, and hopefully if we get the license in another two months, maybe plus a couple of months from there, we should launch our SIF, in which over a period of time, we will migrate our long-shot strategy, which now has a five-year traffic report with the Quartire 1 performance. In this business, we've also strengthened our distribution team. We've recently on-boarded Nimesh Nehta as the chief business officer. He comes with 27 years of distribution experience across Formslide, Mozilla, and ASK asset management, and will play a key role in building and scaling our distribution capabilities. Coming to asset services. I'm really happy to state that business is back on its growth trajectory, following the loss of decline that happened in Q1, and we saw a drop of interest rates by 50 basis points. So we've been able to overcome both of that. Q4 revenues exceeded Q1, and full year revenues grew by about 12%. It's important to note, you know, many a times we've been asked this question that is this business? This is completely aligned to what happens to the market or the flows of the market. Now, if you look at the current year, despite the headwinds, index not doing anything, volatility in the market, yield compression, loss of decline, yet there is a near 15% profit growth. This basically signifies that This business characteristic is different from the core capital market business. Volatility is far lesser. The drivers are very different. So we should not end up equating the same in terms of what will drive this and those businesses needs to be kept subject. This is more market infrastructure-like business. Our focus here remains around increasing our market share and product value enhancements. On the international side, we are aggressively working with what is called GCLC type, Global Custodian, Local Custodian, and we are on the verge of signing one of them globally. On the domestic segment, I have highlighted before that we are building out the RTA and trustee shift services. These offerings are expected to go live by middle of Q3, and this will help us further increase our market share in the domestic clients. We are currently at 22% of our chosen segment. Lastly, coming to capital markets, I think secondary market activity moderated to most of FI26. Equity, cash, ADT declining by about 6% and futures ADT declining by 14. Options also remain strong, 8% bio-wide growth. Q4 witnessed the rebound of activity, but that I think was mostly led because of the volatility of West Asia crisis. Coming to the primary market activity, I think the year was still okay. Record IPO mobilization across more than 100 main board IPOs despite market conditions. Although in H2, I think the story changed a bit, retail participation went down, the quality of IPOs changed, there were certain large IPOs where the fee pool was smaller. So overall, I think we were able to maintain our market share or slightly inched our market share up from 18% to 19% in terms of value and we were 15% in terms of deal. But I think the market saw a reduction overall in the QIP values which had an impact on this business. Coming to fixed income, within capital markets, we had a healthy growth of about 35% year on year. We maintained number one ranking in public issues, and in private placements, we are between three or four. Given, I mean, in one quarter, we could end up threes, the other quarter we could end up at fourth position. Most of the others who are above us are large banks' balance sheet. I think that sums up. From my side, I will now like to hand over the call to Bharat to take you through the financial numbers in detail, and then we can cover the questions which you have. Thank you. Over to you, Bharat.

Thank you, Ashish. Good afternoon, everyone, and a warm welcome to all the participants on the call. Ashish, anyway, has covered the broader business environment as it is our own strategic initiative in the market context. I will now jump on directly to the main numbers for the firm. I am pleased to share our quarter 4 and FI26 results, where we are seeing almost like a steady growth across all our key businesses. Ashish did alluded to the fact that our ID&I was subdued in this quarter, but otherwise all key businesses, whether it was wealth, private, or asset services, saw a decent and a stable growth year on year and quarter on quarter as well. If you look at from our headline number, we have actually crossed the operating profit margin number of 1000 crore. In this year, this is a big achievement for us. And similarly, if you look at that on our dividend side, we have again declared a dividend of Rs. 14. For our H2FI 26, that takes to roughly 50% of our profit being paid as dividend, which is consistent with our dividend distribution policy. Having said that, if you look at on the overall client asset basis, our total firm level client assets were at 4.5 lakhs, which was held by the flows across the businesses including asset services, wealth and private. But there was a mark-to-market impact on the headline number. That's where the impact on the client assets reflected. In terms of the revenue, the quarter 4 revenue was around 825 crore, which is a 7% YOY. But if you remove IE and IB businesses for the quarter, our actual revenue X of IB and IE grew by 13% in quarter 4. And if you look at on a full-year basis, excluding IE and IB, our revenue actually grew by 17%, which is where Wealth and Private has actually shown a 20% growth. And now, Wealth and Private put together contributes 55% of the firm revenue, which was almost 49% last year. So, the share of Wealth and Private has actually gone up. Even if I go further down, if you add Wealth, Asset Management, and Asset Services, now they contribute roughly 80% of the revenue for the firm, which was 74%. Why I am highlighting these numbers are because this gives you that predictability of the earnings in the coming quarters and years, Because these business are more recurring in nature compared to maybe IE and IED, which can have a practical impact on a year-on-year basis or on a quarter-on-quarter basis. Even if you look at the total cost for the firm, for the quarter, the total cost, when I say total cost, it's employee plus office, has actually gone up by 9%, and on a full year basis, it has gone up by 10% only. The reason of calling out is that that reflects the variability in our cost that in a year when the revenue growth is lower, our cost can be controlled or can be reflective of the overall performance. Maybe as a reference to the fact that if you look at our FY25, our revenue went up by 41% and our cost was up by 24%. And in this year, as the revenue has slowed down, so is our cost has been controlled to that extent. Multiple reasons for the revenue slowdown growth was discussed during Ashish's opening remarks, but that's where the cost part comes in. And if you look at from a Q4 cost versus Q2, you will see a growth in the number, but that's typically a seasonality impact which happens in Q4. I would say you compare Q4 F526 with Q4 F525, you will see that the cost has only gone up by 8 to 10 percent, OPEX is up by 7 percent, and the employee cost is up by 10 to 11 percent. That's where the number is. So it's a seasonality which plays in Q4 if compared with Q3. Within cost, if you look at that, our OPEX is around 27% of the cost, that is, quarter on quarter will see a growth of 27%, but if you compare it to the previous year, quarter 4, the growth is only 7%. This is just about the seasonality of the cost, similar trend, you will see it on the Introy side also, Introy cost side. So, to that extent, we are comfortable with what is happening on the cost side. Just a word of upfront disclaimer that maybe in FY27, we'll have some incremental cost coming in our asset management business. As Ashish also alluded to the fact that we are launching the new strategies and obviously for our mutual fund license as we are moving towards the SIF business, there will be an incremental cost which will come. That's more like an investment, not really a so-called cost in isolation to be seen. In terms of the overall, happy to share that the wealth management segment, when I say wealth management segment, wealth and private put together, the cost income ratios actually come down by 80 basis points compared to previous years. And even if I look at asset services and IE and IEB, the cost to income ratios are actually improved by 100 basis points. Just because wealth and private composition has gone up in the overall firm contribution, that is why you will see that the cost to income at the firm level has moved from 55 to 56 percent. This is just a composition issue. Otherwise, the operating leverage in both the businesses being reflected in the cost income ratio being lower than previous year. Operating price, again, if you look at quarter 4, it was 269 growth, which is a 5% YOY growth, but within wealth, within the segment, within the profit growth, wealth segment actually grew by 23% and asset services grew by 12-13% in quarter 4. Even on a full year basis, it is a similar trend where wealth and private has actually gone up by 23-24% and asset services is up by 13-14% in that range. Our ROE has been healthy at 28% for FY26. Ashish covered a lot of details in terms of the individual businesses, but if I have to take headline numbers on the Noama web, the client's assets are at around 1.1 lakh, which is a 14% YOY growth, despite the mark-to-market impact coming in the last quarter. Our MPI test is now stood at around 39,000 crores, and we have registered our net new money at around 8,900 crores during the year, which is a 30% growth on the opening MPI-C, which is where we've been steadily communicating that the wealth should have anything upward of 25 to 30% as an opening, net new money on the opening MPI-C, so we've been maintaining The revenue was at 960 crore, which is a growth of 18%, and the retention remains stable at 90 basis points or so. Again, if you look at the data book, you will find that the cost to income ratio for wealth business has actually improved by 135 basis points compared to previous years. Now it is running at whatever 65.7%, but the operating leverage has started playing in, this is where it is reflected in the cost to income, and the operating PBT went up by 22% for wealth. In terms of the private, again, the numbers across the key parameters, whether it is the overall client assets, whether it is the ARR asset, which has actually gone up by 22%, the net new money, which is again up by 22%, or the revenue has actually gone up by 24%. ARR revenue as of now has now touched 60% of the total revenue for private, which is where we actually feel comfortable at 60-65% of the revenue coming from ARR side. So, I think we are on the right trajectory. Overall retention again remain in our guided range of 85 to 90 basis points, so nothing to call out there. Anyways, we deliberated on the RM expansion, how we have actually added the people over the four years and in this year particularly. The PVT for the business also was up by 24%. Asset management, we discussed, and Ashish actually alluded to the leadership hiring, which we have done in the businesses, both for our private business, for our private credit, as well as on the business side. So I think that piece is at least taking the right shift. Otherwise, if you look at our management, this income is actually up by 51% on a YOR basis, so I think this is where we are heading. In terms of asset services, we did around 209 crore in Q4, and we did around 193 crore in Q1. This business has actually done better than what we expected for quarter four. Despite that, the interest rate has actually come down, and our earnings is basically fixed deposit earnings on the margin money given by the clients. Despite of that, the business has actually came up well. On the I and IB side, the revenue, if you look at, compared to quarter three, it is broadly there, 138 versus 135 crore, and we did discuss about how the market in the quarter four has actually played in, more specifically on the ECM side. One more thing which I want to highlight, which in terms of the fixed income, which is part of the IB business, that has actually grown 34% on a YOR basis, and now it contributes almost 50% of the IB top line, and this business is more. Structural in nature can see a compounding growth of 20-25%. It has seen it and it can continue to see a growth of 20-25% compounding in the years to come. ECM is obviously, you guys understand, this is more linked to the market activity. That is where the volatility or a quarter-on-quarter seasonality can claim. But otherwise, this business has been doing decent for us. Overall, PBT for SS services and capital market was around 830 crore. This is where we are. And I think... If, principally, we look at various businesses, it seems that businesses are on the right track, and our focused businesses are performing relatively much better than what we initially planned for, and I think that's where we are. I hand over to the moderator in terms of the Q&A now.

Thank you very much. We will now begin the question and answer session. If anyone who wishes to ask a question, may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to please use hands-up while asking a question. Ladies and gentlemen, we will now wait for a moment while the question queue assembles. Our first question comes from the line of Manas Agrawal from Bernstein. Please go ahead. Hi, thanks for the opportunity.

I have a couple of questions. I'll start with the relatively easier ones. ECM, there are a couple of large IPOs that are coming. How should we think about our market share on revenue for the year? Are we present in those deals or not? And second, from a... Regulation perspective, 1st of April, mutual funds have cut commissions. So what is the impact for the business or the consult from that perspective? So that is one I will. On the asset services business, I wanted to just understand. A, on yield trajectory, because I understand yields were elevated, and now rates have come down, so you're seeing some amount of contraction going ahead. How do we think about that? The last question is on wealth. You talked about a 25% increase in revenue per RM. Is that all AI productivity? Is that including MTM, flows, etc.? How to think about number of clients per RM in a steady state? Those are the questions.

So, let's start with asset services first. I think broadly, when we do the numbers on yield, unless and until we have a client, you know, which becomes... I think the yield should remain at this level. I don't think the yield will compress because we've seen a decline in the overall interest rates happen and that flow-through has largely happened. Maybe in the next 12 to 15 months, we'll see a reverse of this happening. If the inflation... Stickiness is there because of fuel prices or the war situation being there. And if the central bank is forced to increase the rates, then I think we will see further upward trend in yields that will play out as it may not deposit rate reprived. On ECM side, I think our overall pipeline right now, we have about 40 to 45 live mandates largely across ECM and some in advisory. So the pipeline remains healthy. I think Q4 was when things got pushed a bit and which we should see the recovery happen in the coming quarter. And even in advisory, we have certain large deals which are there. So, hopefully, we will have a good year in investment banking this year. Fixed income, in many ways, continues to move at a very, very rapid pace there. On the well side, 25% increase in productivity is a combination of actually two things. One is the seasoning of the vintage of the aran. If you see last year, our less than one year cohort was around 40-45%. This year, it's fallen to about 33%. So, which means that the R&s of higher vintage have increased in terms of cohorts. So, that contributes some increase in productivity. And second, of course, the contribution comes from the various initiatives you take in improving the learnability and improving the efficiency of people, which is where AI plays a role. So, net new money itself doesn't lead to increase, it's an outcome, it's not the cause. The causes are actually these, net new money and productivity increase is basically the outcome of that.

Understood. Any indication on the mutual fund commission cut impact?

I don't think we will go through that. I mean, it's not a topic which got discussed very kindly internally, so I'm not sure how important it is for us, because anyway, in IE revenues for us, mutual fund is less than 20%, and the pass-through that happened, because whatever initially was proposed and what finally came through, and the net margins which we get, I think is similar to what came through. So there is hardly any impact on us.

Wonderful. Thank you.

Thank you. Our next question comes from the line of Dipanjan Ghosh from Citi. Please go ahead.

Hi. Good morning. Good afternoon, everyone. So, a few questions. First, you know, if I were to think of FI 27, obviously there's a lot of geopolitical uncertainty that still persist. Now, on that backdrop, if you were to think of the transactional revenues, X of broking, majorly in Nuwama private and maybe two of us are recently in Nuwama wealth also, just wanted to get some sense of the deal pipeline that you envisage, or in terms of market activity, what is the sense that you are getting in terms of the transactional revenue, because FY26 was a relatively good year for the company on that front. My second question is on the Novama wealth business. If I look at the 4QE, normally it tends to be a little bit affected on the managed products and investment solutions because of the insurance revenue. But in terms of 4Q to 4Q, I mean, these are held up fairly well, despite the backdrop that one was expecting maybe some moderation with post-ITC changes. So just wanted to get some sense of your insurance commission. I mean, how has that really held up, or was it, or was there some upfronting of CAT1, CAT2, AIS-led commissions out there? And the third question is on the overall wealth piece. Basically, if you were to look at the new incoming customers that you are getting, maybe more from the perspective of Novama private and to a third nation, maybe the high-quality customers in Novama wealth, would this be more from smaller cities, low-ticket size, generational wealth, or first-generation customers, or do it be like coaching from offshore bank service customers? I mean, if you can give some color on the customer quality or demographics out there, and I have two data-keeping questions which maybe I can ask at the end.

So, dependent transactional revenue overall in FY26 for private, the jump was about 14%. So, it was significantly lower than actually the ARR revenue. ARR revenue was 32%. I think if you look at both the businesses and if you look at the decomposition of the transactional revenue for us. Like you said, broking is a large component, and then there is fixed income, which is again a flow business, which actually improves in times when geopolitics goes through this zone. So, I think between these two, if we add, in Noama wealth, at least this would constitute about 90-95%, and 5% would be some transactions or deals, and that also... I mean, unlisted for us is reasonably small and hopefully with NSC listing for everybody it becomes small because we've consistently reduced the exposure to unlisted over the last two years. It's not a large sum for us. So whatever deals happen. They will happen more in high credit transactions where we are co-investing with some fund or in commercial real estate if any. So those are really not impacted by the geopolitics. So for us, actually, except broking, which is more linked to market market volumes, where everything is reasonably insulated and actually works better when the equity markets don't do well. So, both for private and wealth, we don't see that as an impact playing through. I think it could only benefit. From an yield perspective, I think right now the insurance yield impacts have been negligible for us. It has not led to that impact. In fact, the overall volume of insurance growth was also not like, you know, like historically you would grow by 50-50%. I think it stabilized more to 25-30%. But the yield impact is not there. Yes, a bit of category 2 may be higher this year because again, The reason being that if equity markets don't do well, then more money flow will happen in yield-based products, which actually sit in category 2. So there's some amount of first-year commission, which is about 30% of the life commission. About 10% extra is what you make, which can influence the yield a bit. New customers actually remain the same. I don't think there is any change in demographics. Migration from banks... This is a continued phenomenon and that will continue to happen. In Noama wealth, tier 2 is, I mean, beyond tier 1, tier 2 actually is 35-40% of our business. In private, still, I would say the top age 10 cities constitute about 80-85%, 15% would be below that because the density of this thing is still lower. I mean, there are people there, but if you compare it to, let's say, Bombay, Delhi, Bangalore, Hyderabad, Chennai, Bangalore, the density of wealth is far, far, far higher. Maybe another 2-3 years time that 15-20 would reach to a 30% level.

All right. It's just two data keeping questions. One is for FY26 and 4Q26 if you can break up the IB, IE between IB and IE. And the second question is, what is the distributed mutual funds within the overall cohort of distributed MS, PMS, KIS? I mean, whether you put the overall wealth together or private and wealth aggregated out there?

About 8,000 to 9,000 crores.

Sorry, sir, this would be your overall distributed MS, right?

Distributed MS, yeah, borderline 9 to 10,000, correct.

And if I can get the data on IB, IB?

IB and IB, broadly, broadly, right now, the split would be 30-70. 30-70, IB.

Thank you, and all the best.

Thank you. Our next question is from the line of Lalit Mohan Dev from Equirus Securities. Please go ahead.

Yeah, hi, good afternoon, sir, I have two questions. So firstly, if we look at the cost of the ratio for both the wealth segments per effort, it still remains around in the range of around 66 to 67%. So how should we look at this number for the next two years incrementally, given that we are seeing improvement in the R&N productivity as well. And secondly, on the clearing of asset services business, Um, if you can do a back, back of the measure calculation, it suggests that the cash collaterals within the assets under custody, assets under clearing has increased to more than 40% over the last two, three quarters. Um, just want to understand what would have done in those things and how should we, um, and is that just, will that be one of the reasons why we are seeing some pickup in the ease also? And this one data-heating question said, like, within the MPIS revenue in the Nuama Wealth segment for full year and for 26, what would be the slip between recurring and the transaction revenues?

So cost income, just quickly covering that, Nuama Wealth, we've seen a 150 basis points compression this year. And that always will remain a toggle between productivity improvement and how much we want to reinvest back in having capacity. Because if we get growth, and we could have spent that entire 150 basis points in adding more RMs, which we chose not to. But I am saying productivity improvement led growth is 150 basis points in one year. In private, on the other hand, whatever productivity improvement happened, we reinvested in adding capacity. So, this will keep moving, but broadly, like you keep saying, in over a 3-4 year period, you can see a 100 basis point detection every year. Obviously, we can choose to change if we want to add capacity at a more aggressive pace because there is growth to be had. You know, when many such players are coming into the market and operating at a loss making business, I think we don't want to let the field get captured by others. So we will continue to grow and we will continue to toggle between how much of the productivity gains which we will reinvest back into adding capacity because that gives us future growth. I mean, the second question was on the yield of asset services. Yes, the cash component would have gone up. That is the reason why the yield has gone up, and that is because when we lost that large client, their cash component used to be lower given the size of their collateral. That got replaced with large number of smaller clients, so their ratios would be different. As I keep saying, as the client collateral size goes up, your ratio could change and cash could come down. But broadly, you will either be at 70-30 or 75-25 as a portfolio level. The main trend or the impact on yield going forward could be how the interest rates move if the inflation remains sticky. If you think that there is a 50% upside in, let's say, RBI will high trade over the next 12 months, then a flow through of that will happen in deposit pricing, and we will see the yields go up if that happens. In MTS, about 60% to 70% would be maybe

60% annuity and 40% transaction.

Let's go, son. Thank you.

Thank you. Thank you. Thank you. Our next question is from the line of Abhijit Sakkare from Kotak Securities. Please go ahead.

Abhijit, your line is extremely disturbed.

This one. Hello, is it better?

Yeah, this is better.

Okay, so this was an industry question, you know, taking the lead from your opening remarks. You know, for incumbents, when we think about the ultra-ethnic business, it's obviously a compensation problem, you know, but at the same time, like you all say, you know, new entrants do not have a large platform as well. You know, but from a client's point of view, how are they looking at all of these new entrants? Are they starting to kind of give away part of the wallet share, and that's why the industry is kind of getting more fragmented?

So, part of it, I think, will happen that fragmentation, if you look at wealth management, is a global phenomenon. I mean, even if you look at players like, you know, maybe UBS and all, which are world leaders, they have a 2% market share in the global wealth management area. I think India will be most huge in that sense. There will be maybe 3-4 large players, but there will always be a long tail. And what happens if you have a large platform or a multi-product platform, that you will be able to Retain or you will be able to get up. We have a significant proportion of the client portfolio because they also don't want to go through the hassle of having multiple advisors unless there is some genuine value add. And genuine value add in client size could be an access to a transaction or access to a product which let's say you cannot provide but somebody else is providing. So, typically the way industry structure will evolve, that large clients will have, let's say, one or two core wealth managers, where bulk of their portfolio sits. So, most of the annual income and large part of the transactional income will sit there. And then there will be smaller players who will have access to some deals, transactions, where there will be a long day. Obviously, in these smaller platforms also, there will be certain exceptional R&s who will move. They will be able to move some relationships. There is no question about it. But, I think it will be a struggle because every large client wants a lending line, for example, Abhijit. Now, let's say if you already have a lending line with an institution where your products which are not so easily marginable, AIF, illiquid products, it's difficult for a smaller platform to exchange. There are single borrower limits, there are group borrower limits. Then to be We will be able to set up a vehicle offshore to move money. So, I mean, there are significant number of investments in the platform that will be required to be done, capital investment that will be required to be done for some player to start becoming meaningful in this process. 10, 20, 30,000 crore AUM, few RM, few initial client successes, one odd unlisted deal, one odd credit transaction, all this will continue to happen and create a lot of noise. But on a systematic basis, to attract flows, attract people, the kind of platform and infrastructure that is needed to invest and maintain, I find it very difficult to see that all these new incumbents will be able to do it easily.

Okay, that's very helpful. The second question was, if you could clarify on the point that you made on the DTLT-5, how does it play out, and what are the benefits?

So, basically, you know, when SPIs are investing globally, there are certain categories of investors, which are like large long-only funds, who then work with large global custodians, which are multi-country presence. So somebody like a state street or somebody like a city will have multi-country custodian presence, so they will be able to offer their relationship. But somebody like us, who is a single country, single currency custodian, does not have appeal for such clients. So how do we counter that? We counter that by having a strategic tie-up with a global custodian which does not have presence in India. So, it adds for them a new service or a new client segment which they can go after and for us we get access to clients which we would otherwise don't have. So, this is something which exists globally and we are aggressively pursuing. So, we have one or two tiers which are in the work. Once we are able to close, that will basically open up a new set of clients which we were not able to access earlier.

Got it. And just one last data question. In the ultra-acena, there's around, you know, four and a half thousand families that we have. If you could give some further color on what is the distribution in terms of, let's say, more than 5 crore or 10 crore relationship?

More than 10 crore, which is, so if you see the vintage and intersection AUM, more than 10 crore would basically be, I think, a third of the clients, which contribute more than 70-75% of the AUM, and this phenomenon is consistent across the top 2-3 leading players in the market. As per our study of data, People, so families which have spent more than 3 to 4 years start graduating towards higher income per family and then that becomes a larger proportion and rest would be WIP. So, I think about a third to 40% would fall more than 10 crore.

All right, sir. This is very helpful. Thank you so much.

Thank you. Our next question is from the line of Mohit Manga is from Centrum. Please go ahead. Yeah, yeah.

Good afternoon, and thanks for the opportunity.

My first question is, what is the asset management business now? Now, if I look at 26, you know, we had about 1,800 crore of net inflows, obviously distorted by public markets. Now, in 27, you have 1,800 crore of net inflows. 1,800 crore, right?

No, 1,000 crore of net inflows.

Okay, perfect. Now, if I look in terms of, you know, 27, where, you know, SIF and private credit is expected to be launched. So, I just wanted to know, basically, how do you see 27? What are the, you know, reasonable estimates that we can expect from this segment?

Let's go strategy by strategy. Private equity, we've launched our fourth fund. We are currently sitting at about 250 to 75 crores. We target to do maybe anywhere between 1,000 to 1,500. Let's take the conservative side. If you end up at 1,200, so that adds up about 1,000 crores there. Private credit, again, as I said, the launch will be somewhere around... The first fund could target maybe 1,500 crores. Part of it will come this year. I can't certainly say how much, but maybe half of it comes this year. Commercial asset, our next fund also gets launched this year. That would be 3,000 to 4,000 crores. Again, maybe 30-40% starts coming in this year. And on the SIF and public market side, maybe once we launch and we start seeing the flows happen, next quarter we could discuss the numbers, and by that time maybe the volatility levels of the market also should settle down.

Understood. This is very helpful. My second question is towards, you know, the wealth division. I mean, if I look at the external wealth managers, I think we have added about 1,000 over the last 12 to 15 months. Now we have about 8,000 external wealth managers. And our own RMs are pretty stable at about 1,100. So do you see this kind of business model evolving more towards EWM rather than your own RMs? Although I understand the economics kind of feeling the same, but just wanted to understand the business model here.

No, not really. We will grow both and even own RMS. So what has happened in the own RMS right now is that though the number may look steady, but as I said in my initial remarks, that we are doing the process of seniorization. So the individual iron that is going out and the one that is coming in, the one that is coming in, we are getting... More senior variety, higher fixed-pay variety. So, even if the productivity level in terms of X time salary. So, the way industry looks at productivity is very simple. If I give somebody a salary of 100 rupees, what multiple of that comes in as a revenue? So, let's say if you were having an RM of 100 rupees and that person was generating 3x, 300 of revenue, now you have an RM of 200 rupees and he is also generating 3x, which is 600 rupees of revenue, the contribution to the company increases substantially because your other costs per RM do not increase at the same time. You understood? So, that phenomenon also adds to productivity and operating leverage.

Understood. This last year of attrition, I mean, have you had any kind of a regret attrition or, you know, during the year and any loss of RM because, any loss of ABM because of that?

You don't typically lose lots of ABM because the number of hooks are large. Regret attrition in private maybe, you know, range of 1-2% and in wealth maybe, maybe 3-4%.

Okay, understood. Thanks and wish you all the best for planning, please.

Thank you.

Thank you. Our next question is from the line of Saurabh Dole with Fires Assets. Speak overhead.

Yeah, good afternoon. I just have two questions. First is on your private asset front. What exactly is causing the yields to kind of, you know, be so strong? I understand there is a mixed component here where transactional assets versus ARR is improving, but is there any other color that you can provide for the yields? That is question number one. The second one is, when you look at your ARR composition or ARR share improving, to what extent do you think this is happening because some of the transaction assets are moving to ARR? Thank you.

Actually, for us, this second element has still not started playing out. This is a huge opportunity, which we discuss internally, and we are yet to crack it, where we basically have this... You know, mechanism of moving transactional to ARR, which will happen in somewhere around next 12-15 months because now we have the non-discretionary PMS, the discretionary PMS, all the enabling vehicles are in place. We need to orient the team and start going out and, you know, demonstrating the benefits to the client so that migration will happen. Right now, that's not happening. It's purely business. Fresh flows that are coming into ARR. Actually, when we look at the yields, the product-wise yields, there is no change. It's basically composition-led. So, as I said, between 80 basis points to 1%, it will range depending on the composition change on a quarter-to-quarter basis. We've looked at it multiple times. There is nothing more to lead into that.

So, given the fact that ARR is growing much faster than transactional, does it mean that there is more headroom to yields from here?

Actually, our yield which we published here is only ARR yields.

Okay. Okay. You got it. Not a composite yield. Okay. Okay. Thank you. Yeah.

Thank you. Our next question is from the line of Sanitya Agarwal from Unicorn Asset. Please go ahead.

Hi, Dean. Good set. So, first question is on the asset services business. So, given the RBI bank guarantee norms, do we see any impact on the yields from the asset services business perspective? And, like, do we see any changes on the ROC basis of Novama? Uh, capital employed. Second is on the. So, we are seeing on the capital market, we are seeing an upsurge in the SPI derivative turnover on DSC and the SSD contribution in terms of participation on the DSC particularly. So, how do we see it as a trend for our business going forward given the incremental client addition that we are also seeing in our book and also on the exchange side we are seeing a good And lastly, if you could highlight anything, any updates on the PAG side?

So, the bank guarantee thing, we've done the incremental borrowing and all. Basically, for us, we did the math that has an impact, net of deposit cost. Of maybe some 10-15 crores a year, so not much should get covered in. In terms of increase in volume, that of course will have a... You know, positive rub off on the asset services business because if the volumes increase, I am assuming that the profit pool for players will increase and they will deploy more capital. Deployment of more capital basically means more collateral and therefore more earnings that will come to us. On the PAG side, as we have maintained that, you know, they have spent about now five years with the asset, they have seen reasonable return.

Thank you.

Thank you. Thank you. Ladies and gentlemen, we have no further questions at this time. I would now like to hand the conference over to the management for closing comments. Over to you.

Thank you. Thank you all for coming again. I think we will see you again after the end of Q2. Hopefully by then the geopolitical situation would have resolved and we will have something to cheer about. Thank you. Thank you so much. Thank you.

Thank you. On behalf of Novama Wealth Management Limited, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.

Thank you.