CARE Ratings Limited has announced comprehensive credit rating upgrades for Anand Rathi Share and Stock Brokers Limited (ARSSBL), reflecting the company's strengthened financial position following a substantial equity infusion. The rating agency upgraded all debt instruments and bank facilities, citing improved financial flexibility and enhanced leverage metrics.

Rating Upgrades Across All Instruments

The credit rating upgrades span across ARSSBL's entire portfolio of debt instruments and banking facilities:

The upgrades were communicated through CARE Ratings' letter dated April 08, 2026, and subsequently disclosed by ARSSBL to stock exchanges under Regulation 30 of SEBI listing requirements.

Key Drivers Behind Rating Enhancement

The rating upgrade primarily reflects the significant equity infusion of ₹745 crore raised through ARSSBL's initial public offering in September 2025. This capital injection has substantially improved the company's financial flexibility and is expected to support growth in the margin trading facility (MTF) and distribution segments while improving leverage metrics over the medium term.

ARSSBL's tangible net worth increased dramatically to ₹1,335 crore as on December 31, 2025, from ₹495 crore as on March 31, 2025. Consequently, overall gearing moderated significantly from 2.59x in FY25 to 0.90x in 9MFY26, while fund-based gearing improved from 1.83x to 0.59x during the same period.

Financial Performance and Business Diversification

The company demonstrated strong financial performance in FY25, with total income growing 23.73% to ₹845 crore, driven by higher interest income and brokerage revenue. Profit after tax stood at ₹104 crore, translating to a PAT margin of 12.29%, reflecting an improvement of 78 basis points year-on-year.

ARSSBL has successfully diversified its revenue profile, reducing dependence on volatile broking income. While brokerage contributed approximately 80% of total income in FY17, its share declined to 52.39% in FY25 and 44.68% in 9MFY26. The balance is now driven by interest income, primarily from MTF operations, and distribution income.

Rating Strengths and Constraints

CARE Ratings highlighted several key strengths supporting the upgraded ratings:

• Experienced management team led by co-founder and Managing Director Pradeep Gupta
• Established presence in the broking industry with over three decades of experience
• Strategic importance within the diversified Anand Rathi Group ecosystem
• Stable earnings profile with diversified income streams
• Strong liquidity position with overall liquidity of ₹3,197 crore as on December 31, 2025

However, the ratings remain constrained by modest scale of broking operations relative to larger industry peers, inherent risks associated with capital market-linked businesses, competitive intensity in the core broking segment, and the evolving regulatory landscape affecting the sector.

Market Position and Growth Outlook

ARSSBL maintains a market share of 0.25% across both cash and derivatives segments in FY25, with relatively higher presence in the cash segment at 0.88%. The company's MTF book has emerged as a key growth driver, scaling from ₹305 crore as on March 31, 2022, to ₹1,232 crore as on December 31, 2025.

The asset under distribution (AUD) has grown from ₹2,772 crore as on March 31, 2022, to ₹8,369 crore as on December 31, 2025, with mutual funds comprising the largest component. CARE Ratings has assigned a stable outlook, expecting ARSSBL to continue demonstrating stable business profile with timely support from the parent company given its strategic importance and shared brand name.

Anand Rathi Share and Stock Brokers Limited has fulfilled its quarterly regulatory compliance obligations by submitting the required certificate under SEBI (Depositories and Participants) Regulations, 2018 to both BSE and NSE for the quarter ended March 31, 2026.

Regulatory Compliance Submission

The company submitted the compliance certificate on April 09, 2026, through Company Secretary and Compliance Officer Chetan Prajapati (Membership No.: A39130). The submission was made to both major stock exchanges where the company is listed.

Certificate Confirmation from Registrar

MUFG Intime India Private Limited, formerly known as Link Intime India Private Limited, serves as the company's Registrar and Share Transfer Agent. The firm issued the compliance certificate on April 3, 2026, confirming adherence to regulatory requirements.

The certificate confirms several key compliance aspects:

• Securities received from depository participants for dematerialisation during Q4FY26 were properly confirmed to depositories
• All securities comprised in certificates have been listed on stock exchanges where earlier issued securities are listed
• Security certificates received for dematerialisation were confirmed or rejected within prescribed timelines
• Received certificates were mutilated and cancelled after due verification by depository participants
• Depository names were substituted in the register of members as registered owners within regulatory timelines

Corporate Structure Details

MUFG Intime India Private Limited operates under CIN: U67190MH1999PTC118368, with its registered address at C-101, Embassy 247, L.B.S. Marg, Vikhroli (West), Mumbai - 400083. The certificate was signed by Ashok Shetty, Sr. Vice President-Corporate Registry.

Regulatory Framework

This submission falls under Regulation 74(5) of the Securities and Exchange Board of India (Depositories and Participants) Regulations, 2018, which mandates quarterly compliance certificates from listed companies regarding their dematerialisation processes and depository participant interactions.