Nuvama Wealth Management Limited , a leading player in the Indian financial services sector, has reported a resilient performance for the second quarter, despite market volatility and the loss of a large client in its Asset Services business.

Key Financial Highlights

• Revenue: INR 772.00 crores (4% year-over-year growth)
• Profit After Tax (PAT): INR 254.00 crores
• Return on Equity (ROE): 28.00%

Business Segment Performance

Wealth and Private Business

The Wealth and Private businesses led the company's growth, expanding by 26% year-over-year. These segments now contribute 57% of total revenue, up from 47% in the same quarter last year.

Asset Services

Despite the loss of a large client, the Asset Services business has shown resilience:

• Recovered 50% of the revenue lost from the large client departure
• Management expects full recovery of lost revenue by January-February

Lending Business

The company's lending book grew by 40% during the quarter, reflecting a strategic focus on expanding this segment.

Asset Management

• Commercial Real Estate Fund: Reached INR 2,400.00 crores in fundraising towards a target of INR 4,000.00 crores
• Public Markets: Total gross sales were 2.5 times that of Q1

Corporate Actions

1. Interim Dividend: The Board has declared an interim dividend of INR 70.00 per share.
2. Stock Split: Approved a stock split from INR 10.00 to INR 2.00 face value to improve liquidity for retail investors.

Management Outlook

• Maintains guidance for net flows of INR 25,000.00-26,000.00 crores for the fiscal year
• Expects to fully recover the lost Asset Services revenue by early 2026

Market and Regulatory Environment

Management views the Indian economy as steady and resilient, supported by strong domestic demand. They also noted a pragmatic approach from regulators like SEBI and RBI, which is expected to have a positive long-term impact on the wealth management, asset management, and capital markets businesses.

Ashish Kehair, Managing Director and CEO, commented, "Our resilient Q2 performance reflects the strength of our diversified platform. We were able to capture flows across asset classes in our Wealth businesses and saw strong synergies between Wealth and Asset Management."

The company's focus on recurring revenue and managed products in its Wealth and Private segments appears to be yielding results, with these areas showing strong growth and contributing significantly to overall revenue and profitability.

As Nuvama Wealth Management continues to navigate market challenges and capitalize on growth opportunities, investors will be watching closely to see if the company can maintain its momentum and achieve its full-year targets.

Nuvama Wealth Management Limited (NWML) has reported a mixed set of financial results for the second quarter, along with significant corporate actions that could impact shareholders.

Financial Performance

For the quarter ended September 30, NWML reported:

Note: All financial figures are in billion Indian Rupees (Rs) unless otherwise stated.

The company's revenue and EBITDA showed healthy year-over-year growth, with EBITDA margin improving by 123 basis points. However, the consolidated net profit saw a slight decline of 1.60% compared to the same quarter last year.

Corporate Actions

Share Split

The Board of Directors has approved a sub-division of the company's equity shares in a 1:5 ratio. This means that each existing equity share with a face value of Rs 10 will be split into five equity shares with a face value of Rs 2 each. The move aims to enhance the liquidity of the company's shares and encourage broader retail investor participation.

Interim Dividend

NWML has declared an interim dividend of Rs 70 per share. The record date for this dividend has been set as November 11, with the payment expected to be completed by December 3, subject to applicable taxes.

Additional Corporate Developments

1. Rights Issue Investment: The Board has approved an investment of Rs 200 crore towards the subscription of a rights issue by Nuvama Wealth Finance Limited (NWFL), a wholly-owned subsidiary of NWML.

2. Regulatory Compliance: The company has confirmed that the proceeds from unsecured Commercial Papers issued and outstanding as of September 30 are being utilized as per the stated objectives in the offer document.

3. Subsidiary Performance: NWFL, a key subsidiary, reported total revenues of Rs 632.68 crore for the year ended March 31, with a net worth of Rs 900.70 crore as of that date.

Market Impact and Outlook

The announced share split is expected to make NWML's shares more accessible to a broader range of investors, potentially increasing liquidity in the stock. The substantial interim dividend of Rs 70 per share signals management's confidence in the company's financial position and commitment to shareholder returns.

While the slight dip in net profit may raise some concerns, the overall growth in revenue and EBITDA, along with margin improvement, suggests that NWML's core business remains strong. The investment in NWFL's rights issue also indicates the company's focus on strengthening its presence in the non-banking financial services sector.

Investors and market analysts will likely watch closely how these corporate actions impact NWML's stock performance and financial metrics in the coming quarters.