Anand Rathi Share and Stock Brokers Limited reported a profit after tax (PAT) of ₹233.51 million for the quarter ended June 30, 2026, a marginal increase of 2.3% from ₹228.10 million in the same period last year. On a consolidated basis, net profit stood at ₹234 million compared to ₹228 million in the year-ago period. The results were impacted by an exceptional expense of ₹209.96 million recognized as compensation for losses incurred by two clients due to fraudulent off-market transfers of shares from their demat accounts. Excluding this exceptional item, PAT grew 71.2% to ₹390.62 million. The company has reported the incident to the Economic Offences Wing and relevant exchanges, stating it has filed insurance claims to recover eligible losses.

Total revenue from operations expanded 22.4% year-on-year to ₹2,461.03 million on a standalone basis, driven by a 15% increase in broking-related services and a 52% surge in interest on Margin Trading Facility (MTF). On a consolidated basis, revenue stood at ₹2,466 million compared to ₹2,017 million in the year-ago period. EBITDA rose 30.2% to ₹973.00 million, with the margin improving to 39.5%. The board approved the unaudited financial results for the quarter ended June 30, 2026. The statutory auditors, R Kabra & Co. LLP, issued an unmodified conclusion on the limited review of the financial results.

Financial Performance

The following table summarizes the key standalone financial metrics for the quarter:

The consolidated financial metrics for the quarter are as follows:

The net worth of the company was reported at ₹13,463.35 million as of June 30, 2026. The board approved material related party transactions with Anand Rathi Financial Services Limited and Anand Rathi Global Finance Limited for the financial year 2026-27, subject to shareholder approval via postal ballot.

Operational Metrics

The company's Assets Under Management (AUM) rose 25.8% year-on-year to ₹94,791 million, enhancing recurring revenue potential. The MTF book grew 54.6% to ₹13,318.46 million, driven by strong demand for leveraged investment solutions. The board also authorized the raising of capital through the issuance of Non-Convertible Debentures (NCDs) for an amount not exceeding ₹500 crore and approved the incorporation of a wholly owned subsidiary in Dubai, UAE, subject to regulatory approvals.

Management Commentary

In an earnings call held on July 15, 2026, management stated that the exceptional expense of ₹209.96 million was recognized towards the restoration of securities for two clients who suffered losses due to fraudulent off-market transfers. The company has engaged an external consultant to strengthen internal controls and processes. The Economic Offences Wing has traced the money trail and attached certain assets and bank accounts of the beneficiaries. Management expects the MTF book to reach ₹1,750 crore to ₹1,800 crore by the end of the financial year, while distribution AUM is targeted to scale by 40%. The company aims to maintain a 50-50 mix between broking and non-broking income over the medium term.

The Hon'ble High Court of Judicature at Bombay has quashed and set aside an arbitral award that directed a client to pay Anand Rathi Share & Stock Brokers ₹4,93,54,947.40 plus interest. The judgment dated July 16, 2026, was delivered in Commercial Arbitration Petition No. 215 of 2022 under Section 34 of the Arbitration and Conciliation Act, 1996. The court ruled that the award was contrary to the fundamental policy of Indian Law and shocked the conscience of the court, as the subordinate tribunal had sat in appeal over an Appellate Tribunal order.

The impugned award, passed on January 6, 2022, by the Arbitral Tribunal of the National Commodity & Derivatives Exchange Limited (NCDEX), arose from remanded arbitration reference No. NCDEX/REM/ARB/018/2021-22. The dispute pertained to trading transactions in castor seed contracts on the NCDEX platform undertaken during September–October 2019 involving Shah Atul P. HUF. The award had required the client to pay the company ₹4,93,54,947.40 along with applicable interest.

The company clarified that the Bombay HC judgment does not impose any monetary liability or financial obligation on it. Consequently, there is no adverse financial impact on the company resulting from this legal development. The court emphasized the importance of judicial discipline and the hierarchy of courts, stating that a subordinate tribunal cannot sit in appeal over the order of an Appellate Tribunal.

Anand Rathi Share & Stock Brokers stated that it is evaluating the judgment and the legal remedies available to it. The company is considering the possibility of initiating fresh arbitration proceedings in relation to the disputed matter. Further updates will be provided in accordance with the applicable provisions of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Key Details of the Proceedings