This wealth management stock has zoomed 394% in 1 year; approves buyback

Shares of Anand Rathi Wealth hit a new high of Rs 4,215 as they rallied 5 per cent on the BSE in Monday's intraday trade, in an otherwise weak market, after the company approved Rs 164.65-crore buyback through tender offer. The stock of the financial products distributor surpassed its previous high of Rs 4,199.80 touched on March 4, 2024. In comparison, the S&P BSE Sensex was down 0.86 per cent at 73,604 at 01:42 PM.

Anand Rathi Wealth, in an exchange filing, said that the board of directors has approved a proposal to buyback up to 370,000 equity shares of the company at Rs 4,450 per equity share, aggregating up to Rs 164.65 crore. This represents 0.88 per cent of the total paid up equity share capital.

On the bourses, the stock price of Anand Rathi Wealth has zoomed 394 per cent in the past one year, as against 23 per cent rise in the S&P BSE Sensex. In the past six months, it has surged 132 per cent as compared to 11 per cent gain in the benchmark index.

Anand Rathi Wealth is amongst India's leading non-bank wealth solutions firms, catering to high and ultra-high net worth individuals. The company has evolved into providing well defined uncomplicated wealth solutions to its clients. In addition to Private Wealth Vertical (PW), the company has two new age technology led business verticals i.e., Digital Wealth (DW) and Omni Financial Advisors (OFA).

DW business is a fin-tech extension of the company's proposition for the mass affluent segment with wealth solutions delivered through a combination of human interface empowered with technology. OFA business, meanwhile, is a strategic extension for capturing the wealth management landscape to service retail clients through mutual fund distributors by using a technology platform.

For the financial year 2024 (FY24), Anand Rathi Wealth reported a healthy 35 per cent year-on-year (Y-o-Y) growth in revenue at Rs 752 crore. Profit after tax (PAT) surged by 34 per cent Y-o-Y to Rs 226 crore, exceeding the forecasts for the fiscal year. Assets under management (AUM) recorded a 52 per cent Y-o-Y jump to Rs 59,351 crore. The management is confident in the company's future, and has projected a continued growth trajectory of 20 per cent – 25 per cent.

"We are optimistic about the future of the wealth management industry, buoyed by factors such as increasing wealth, changing investor preferences, and technological innovations. These elements promise to revolutionize the wealth management domain, offering substantial growth and opportunities,” the management said.

Amidst a fluctuating global economic environment, the Indian economy has emerged as a pillar of stability and hope. Despite the challenges posed by geopolitical tensions, the resilience of the Indian equity capital markets has been noteworthy, contributing significantly to wealth generation and the robust growth of the wealth management sector, the management said.