Anand Rathi Wealth Q2 results: Rs 4 dividend declared as record inflows push AUM past Rs 1.08 lakh crore

Anand Rathi Wealth has declared an interim dividend of Rs 4 per share alongside its second-quarter earnings, which revealed a sharp split between its operational business growth and its final statutory profit.

While the wealth manager's core business profit after tax climbed 22% to Rs 122 crore for the quarter ending September 2026, its final reported net profit fell 10% to Rs 89.3 crore. The company explained that the decline in the statutory figure was driven by non-operational accounting adjustments, including employee stock option (ESOP) costs and fair value adjustments.

Shareholders will receive an interim dividend of Rs 4 per equity share, representing 80% of the stock's Rs 5 face value. The company's board has set Thursday, October 15, as the record date to determine eligibility, meaning investors must hold the shares by Wednesday, October 14, to qualify. The payout is scheduled to be completed within 30 days.

Why the profit numbers look different

The headlines for Anand Rathi Wealth's second quarter present two different realities. The company’s "business profit after tax" — which measures the performance of its underlying wealth management operations — rose 22% to Rs 122 crore, up from Rs 100 crore in the same period last year. Revenue on this operational basis rose 16% to Rs 357 crore.

However, when statutory accounting rules are applied to include fair value gains and ESOP expenses, the reported net profit fell to Rs 89.3 crore (with some filings reporting Rs 88.95 crore), down from over Rs 99 crore last year.

On a standalone basis, which excludes subsidiaries, the firm posted a net profit of Rs 121 crore, up 25% year-on-year.

Record inflows push AUM past milestone

The real driver of the business was an unprecedented rush of client money. Anand Rathi Wealth pulled in its highest-ever quarterly net inflows of Rs 4,186 crore during the September quarter, representing a 39% jump compared to last year.

A large portion of this came from equity mutual funds, where net inflows also reached a record Rs 2,867 crore, up 39%. This influx pushed the company's total assets under management (AUM) to Rs 1.08 lakh crore (Rs 1,08,377 crore), an 18% increase year-on-year.

Mutual fund distribution continues to be the bedrock of the business, with distribution revenue rising 18% to Rs 145 crore for the quarter.

Challenging conditions for equities

Chief Executive Officer Rakesh Rawal and Joint CEO Feroze Azeez pointed out that the steady growth came despite a volatile macroeconomic backdrop. Indian equities have been rattled by persistent foreign portfolio outflows, geopolitical tension involving Israel and Iran, a strengthening US dollar, and rising US bond yields.

The management highlighted that while foreign institutional investors have turned cautious, domestic high-net-worth individuals are staying the course. Existing clients deepening their relationships with the firm accounted for a significant portion of the quarter's record inflows.

To support this growth, the company has continued to hire, adding 45 new relationship managers over the past 12 months to bring its total to 431. Active client families grew by 12% to 14,309.

Progress against full-year targets

For the first half of the financial year (H1 FY27), Anand Rathi Wealth has recorded a consolidated business profit of Rs 238 crore on revenue of Rs 693 crore. This means the company has already met 52% of its full-year profit guidance of Rs 460 crore and 49% of its full-year revenue target of Rs 1,415 crore.

The company said it is confident of maintaining a long-term growth rate of 20% to 25%, pointing to its scalable operational model. It currently operates across 19 Indian cities, as well as Dubai and London, and has recently received regulatory approvals to begin operations in GIFT City.

Despite the positive operational metrics and the dividend announcement, the stock faced selling pressure on the day of the release. Shares closed down 4.68% at Rs 2,038.70 on the NSE. Even with the daily drop, the stock has delivered a 31% return so far this year and has surged over 330% over the last three years.