Anand Rathi Share and Stock Brokers Limited board has approved a ₹2 crore investment in its wholly owned subsidiary, Anand Rathi International Ventures (IFSC) Private Limited. The board meeting held on February 26, 2026, also approved the reappointment of Managing Director Pradeep Navratan Gupta for another three-year term.

Board Meeting Outcomes

The board approved multiple strategic decisions during its meeting that commenced at 4:30 PM and concluded at 5:30 PM. The investment in the IFSC subsidiary will be made through equity subscription via a right issue, based on the Audit Committee's recommendation.

Leadership Continuity

The board approved the reappointment of Pradeep Navratan Gupta as Managing Director for a three-year term from March 01, 2026, to February 28, 2029. This decision was made based on recommendations from both the Nomination and Remuneration Committee and Audit Committee, subject to shareholder approval.

IFSC Subsidiary Performance

Anand Rathi International Ventures (IFSC) Private Limited, incorporated on December 28, 2016, operates as a trading member of India International Exchange (IFSC) Limited, NSE IFSC Limited, and India International Bullion Exchange IFSC Limited. The subsidiary serves non-resident Indians and family offices for international investments while also acting as a corporate agent for insurance business.

Related Party Transactions

The board also approved material related party transactions with Anand Rathi Financial Services Limited and Anand Rathi Global Finance Limited for Financial Year 2026-27, subject to shareholder approval. These decisions will be presented to shareholders through a postal ballot process covering the MD reappointment and related party transactions.

CRISIL Ratings has assigned its 'A/Stable' rating to the bank loan facilities of Anand Rathi Share and Stock Brokers Limited (ARSSBL) while reaffirming the commercial paper programme rating, reflecting the company's strong fundamentals and strategic positioning in the capital markets business.

Rating Details and Rationale

The credit rating agency assigned the following ratings to ARSSBL's facilities:

The rating factors in ARSSBL's strong operational and financial linkages with its parent company, Anand Rathi Financial Services Ltd (ARFSL), which has an established 30-year track record in capital market businesses. The assessment also considers the company's diversified business risk profile, sound risk management systems supported by experienced senior management, and adequate capital position for current and planned operations.

Financial Performance and Capitalisation

ARSSBL demonstrated improved financial performance with reported profit after tax of INR 104 crore for fiscal 2025 compared to INR 79 crore for fiscal 2024. The company maintained healthy profitability in the nine months of fiscal 2026 with PAT of INR 90 crore.

The company's capitalisation strengthened significantly with networth increasing to INR 1,346 crore as of December 31, 2025, from INR 507 crore as of March 31, 2025. This substantial increase resulted from a primary capital infusion of INR 745 crore through an initial public offering completed on September 30, 2025.

Business Operations and Market Position

ARSSBL operates through a hybrid model comprising proprietary branches and an extensive franchise network. The company serves over 9.9 lakh customers with approximately 96,000 active clients as of December 31, 2025. The broking business maintains a market share of 0.3% in both cash and derivatives segments for fiscal 2025, with a higher 0.9% market share in the cash segment.

The company's revenue mix is diversified across multiple streams:

• Broking income: approximately 52%
• Interest income on margin trade funding: approximately 18%
• Distribution income: approximately 10%
• Other income (primarily float interest): 20%

Risk Management and Regulatory Compliance

CRISIL highlighted ARSSBL's sound risk management systems, noting that the company has maintained nil quarterly losses since inception. The entity adheres to all SEBI and exchange-prescribed regulations through requisite systems and processes. Key risk management features include real-time client exposure monitoring, scrip-wise exposure limits, upfront margin collection, and automated square-off mechanisms during adverse price movements.

Rating Outlook and Sensitivities

The stable outlook reflects expectations that ARSSBL will continue maintaining healthy capitalisation metrics while benefiting from its presence across capital market businesses and adequate risk management systems. However, CRISIL noted that the company's ability to improve market position and profitability will require monitoring, particularly given the elevated cost-to-income ratio of 78% and exposure to inherent market and regulatory risks in the broking industry.