Anand Rathi Share and Stock Brokers Limited has issued a postal ballot notice dated February 26, 2026, seeking shareholder approval for material related party transactions and the reappointment of Managing Director Pradeep Navratan Gupta.

E-Voting Schedule and Process

The company has set the cut-off date as February 25, 2026, for determining eligible shareholders. The e-voting period will commence at 9:00 AM on March 2, 2026, and conclude at 5:00 PM on March 31, 2026. MUFG Intime India Private Limited will provide the e-voting facility, with CS Mannish L. Ghia appointed as the scrutinizer.

Material Related Party Transactions

The postal ballot includes approval for substantial related party transactions with two key entities for Financial Year 2026-27.

Transactions with Anand Rathi Financial Services Limited (ARFSL)

The company seeks approval for transactions worth ₹69,681.40 lakhs with its holding company ARFSL, which holds 69.90% stake in the company.

Transactions with Anand Rathi Global Finance Limited (ARGFL)

Approval is also sought for transactions worth ₹68,006.00 lakhs with group company ARGFL, an NBFC-Middle Layer entity.

Managing Director Reappointment

The third resolution seeks approval for reappointing Pradeep Navratan Gupta as Managing Director for three years from March 1, 2026, to February 28, 2029, with remuneration not exceeding ₹21.00 crores per annum.

IFSC Subsidiary Investment Update

The board had previously approved a ₹2.00 crore investment in Anand Rathi International Ventures (IFSC) Private Limited through equity subscription via rights issue. The IFSC subsidiary reported total income of ₹2.12 crores and net worth of ₹6.65 crores for FY2024-25.

The proposed resolutions will be deemed passed on March 31, 2026, if approved by the requisite majority through the postal ballot process.

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.