Abans Financial Services Limited (AFSL) has announced that its step-down subsidiary, Abans Commodities (I) Private Limited (ACIPL), has submitted a settlement application to the Securities and Exchange Board of India (SEBI) in compliance with a Securities Appellate Tribunal (SAT) order.

Background

The move comes in response to SEBI's earlier decision to cancel ACIPL's Certificate of Registration. This decision had been stayed by SAT in May 2023, pending further proceedings.

SAT's Directive

On December 12, 2023, SAT disposed of a group of appeals related to the matter. The tribunal directed SEBI to develop a scheme under the SEBI (Settlement Proceedings) Regulations, 2018. SAT also extended the interim relief, which had stayed the effect and operation of SEBI's original order.

SEBI's Response

In compliance with SAT's directive, SEBI introduced a Settlement Scheme on August 25, 2023. This scheme provided a framework for resolving the ongoing regulatory issues.

ACIPL's Action

On September 30, 2023, ACIPL filed a settlement application with SEBI under the Settlement Regulations. This move is aimed at resolving the regulatory concerns and potentially maintaining its registration status.

Implications for Abans Financial Services

As the parent company of ACIPL, Abans Financial Services Limited (formerly known as Abans Holdings Limited) is closely monitoring the situation. The outcome of this settlement application could have significant implications for the group's commodities trading operations.

Disclosure Compliance

AFSL has made this disclosure in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has stated that further updates will be provided as the settlement process progresses.

Investors and stakeholders of Abans Financial Services Limited will be keenly watching the developments of this settlement application, as it could impact the group's operational capabilities in the commodities market.

Abans Financial Services Limited (AFSL) has reported robust financial results, showcasing strong growth across key metrics and reaching a significant milestone in Assets Under Management (AUM).

Financial Highlights

The company reported a 35% year-on-year increase in net profit, while achieving a milestone of ₹3,500.00 crore in Assets Under Management.

Business Performance

The diversified financial services company demonstrated strong momentum across its various business segments, including asset management, investment advisory, broking, lending, and treasury operations. AFSL's global presence spans India, the UK, Mauritius, and GIFT City, contributing to its comprehensive financial services offerings.

Fee-Based Services Growth

A standout performance was observed in the company's fee-based investment services, which generated revenue of ₹165.00 crore in the previous fiscal year. This segment has shown significant potential for margin expansion as the company leverages its established infrastructure to scale operations efficiently.

Strategic Initiatives and Partnerships

AFSL is actively pursuing growth through various strategic initiatives:

1. Expanding through partnerships with distributors like SMC Global and Taurus Wealth to enhance global reach.
2. Launching new asset management vehicles both onshore and in GIFT City.
3. Entering the merchant banking space to complement advisory and capital-raising capabilities.
4. Setting up a back office center in GIFT City through its UK subsidiary, Abans Global Limited, to improve cost efficiencies and operational scalability.

Management Outlook

The management expressed confidence in the company's growth trajectory, anticipating:

• Doubling of AUMs every 12-18 months
• Expansion of fee income margins due to established fixed infrastructure costs
• Continued growth in lending book
• Improved operational leverage as new initiatives start contributing to revenues

Earnings Call Highlights

During the earnings conference call, CFO Nirbhay Vassa emphasized the company's focus on scaling high-margin fee-based businesses to ensure earnings stability. He also highlighted the company's efforts in strengthening global market connectivity while maintaining compliance with evolving regulations.

Future Strategy

AFSL's strategy centers on:

1. Scaling fee-based businesses for earnings stability
2. Strengthening global market connectivity
3. Leveraging technology for operational efficiency and risk control
4. Building a diversified revenue base across geographies, products, and customer segments

The company remains committed to delivering sustainable growth while balancing performance, prudence, and innovation in the financial services sector.

As Abans Financial Services continues to expand its presence in the alternative investment space and mid-market segment, it aims to position itself as a global asset manager, capitalizing on the growing interest in alternative investments and AIFs (Alternative Investment Funds).

With its asset-light, high ROE business model and strategic positioning across multiple geographies, Abans Financial Services Limited appears well-positioned to capitalize on emerging opportunities in the financial services landscape.