Q4 25/26

Apr 23, 2026

Summary

FY26 revenue rose 24% and PAT 46%, with growth across broking, advisory and NBFC. Management targets ~30% revenue and profitability growth, alongside FY27 expansion in AMC and the IPPB platform.

Ladies and gentlemen, good day, and welcome to the Q4 FY 2026 earnings conference call hosted by Choice International Limited. As a reminder, all participant lines will be in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Ms. Forum Gosher from Adfactors PR Investor Relations. Thank you, and over to you, Ms. Forum. Good evening, everyone. On behalf of Choice International Limited, I welcome you all to the earnings conference call for Q4 and FY 2026. Joining us today from the management are Mr. Arun Poddar, Group CEO, Mr. Ajay Kejriwal, Executive Director, and Mr. Ayush Sharma, Head of Investor Relations. The earnings presentation has been uploaded on the exchanges as well as on the company website. You may refer to it as we walk you through the opening remarks and the discussion during the call. Before we begin, I would like to remind you that certain statements made during this call may be forward-looking in nature and are subject to risks and uncertainties. These are detailed in the company's annual report and other investor disclosures available on the website. Choice International does not take or undertake any obligations to publicly update these forward-looking statements. With that, I will now hand over the call to Mr. Arun Poddar to share his opening remarks. Thank you, and over to you, sir. Good evening, everyone, and thank you for joining us today. In FY 2026, India maintains steady progress, backed by a stable policy environment and consistent execution. There is a growing confidence across sectors, driven not just by expectation, but by the change already visible on the ground. Continued investment by global players across industries such as technology, manufacturing, service, energy, and logistics reflect that long-term commitment to India's growth story. In this context, our performance in Q4 FY 2026 reflects stable progress for Choice, with continued momentum across our institutional distribution and product-led business. Our focus during the quarter remained on strengthening our platform, expanding our reach, and building partnerships, while also growing our presence in areas such as public sector advisory. During the quarter, our consulting subsidiaries secured government mandates aggregating approximately INR 55 crore. These mandates span program management, governance reform, and digital transformation, indicating our growing presence in public sector advisory space. In wealth management, we secured a digital investment platform mandate from India Post Payments Bank. This provides access to a large distribution network and supports our effort to scale this business. In asset management, we expanded our offering with the launch of the Choice Nifty 50 Index Fund and Choice Nifty Next 50 Index Fund, in line with our focus on long-term investing solution. Our business performance this quarter reflected deliberate emphasis on building strength within each vertical rather than pushing broad-based expansion. In broking and distribution, our focus continued to be on the cash delivery segment. This has helped maintain margins and build a more stable clientele base. The segment contributed 59% to total revenue, with stock broking AUM at INR 52,482 crores in Q4 FY26, growing 28% year-over-year. Wealth AUM stood at INR 4,268 crores, supported by steady clientele participation in delivery-led products. Our network with 67,000 Choice Business Associates remains an important part of our distribution strategy. This model allows us to combine digital capabilities with on-ground presence, helping us expand our reach while maintaining client engagement. During the quarter, our Demat account base grew to 13 lakhs, up 16% year-over-year, supported by improved onboarding and a wider product offering. In the insurance business, we saw consistent growth driven by a broader partner network and increased use of digital platforms. Premium collections stood at INR 84 crores in Q4 26, reflecting 14% year-over-year growth, while policy volume stood at 50,887 number of policies. In our NBFC segment, we continue to focus on secured lending given the current environment in unsecured lending. Our emphasis on MSME, micro-LAP, rooftop solar financing supports more stable growth. The loan book stood at INR 800 crores as of FY26, with the segment contributing 13% to total revenue. Our in-house collection process continued to support asset quality, with NPAs remaining stable at 1.86% of March 31st 26. The advisory business continued to benefit our ongoing infrastructure and governance-related project with an order book of INR 698 crores. We are working on projects such as digital PACS, multilateral support initiatives. This segment contributed 28% to total revenue and provides visibility over the next two to three years. Now let me pass it on to Ayush Sharma, our Head of Investor Relations, who will present the quarter's financial performance. Thank you. Thank you, sir. I will now walk you through our financial performance for Q4 and the full year FY26. During the Q4 FY26, Choice reported consolidated revenue of INR 314 crores, representing a growth of 23% on year-over-year basis. EBITDA for the quarter stood at INR 123 crores, with margins at 39.08%, reflecting improved operating efficiency. Profit after tax came in at INR 68 crores, translating into a margin of 21.62% and a year-over-year growth of 27%. For the full year FY26, consolidated revenue was at INR 1,145 crores, up 24% compared to last year. EBITDA stood at INR 425 crores with margins at 37%, while PAT was INR 238 crores, reflecting a growth of 46% on a year-on-year basis. Overall, the performance reflects steady execution across businesses and continued strength in our operating model. Looking at segment performance, the broking and distribution business reported revenue of INR 179 crores in Q4 with a PBT of INR 55 crores. Our Demat account base has grown to 12.63 lakhs, while we are seeing increased engagement per client supported by cross-selling of insurance and wealth products through the FinX platform. The NBFC segment recorded revenue of INR 43 crores and PBT of INR 2 crores during the quarter. Asset quality remains stable, with GNPA at 2.74% and NNPA at 1.86%. This has been supported by disciplined underwriting, improved collections, and a diversified loan book. Net interest margins remained healthy at 11.22%, in line with our focus on secured lending. In the advisory segment, Q4 revenue stood at INR 91 crores with a PBT of INR 31 crores. For FY 2026, the segment reported revenue of INR 330 crores and a PBT of INR 120 crores. Performance during the period was supported by steady execution and continued inflow of mandates, including repeat engagements. With this, I would now like to open the floor for any questions. Thank you. We will now begin the question and answer sessions. Anyone who wishes to ask a question may press star and one on the touchtone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use hands while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Urmish Shah from Moneywisers. Thank you, and over to you. Yeah. Am I audible? Yeah. Hi, Urmish. You are very well audible. Yes, sir. So thank you for the opportunity. My first question is on the wealth product AUM. You witnessed a 23% decline. Could you give some color on that? Sure. So if you will see, there is a decline in overall AUM. However, there is a growth of 35% in the equity MF AUM. The decline is largely driven by redemptions in the debt mutual funds, which is natural because of the market sentiment where people can withdraw their excess capital deployed in debt and tend to invest in equities at better prices. So that's the larger reason which is driving the reduction in the debt AUM. Anyways, the margins in equity is higher for the company compared to debt mutual funds, which is therefore, there is no larger impact on the overall revenue of the company. Right. But as you are saying, the reason is this what we will witness if the market conditions are not stabilized going further? Do you see that as a future? In the future? No, our focus product is also equity AUM. Okay a consistent growth in the equity mutual funds. That is largely a treasury product. That will not be our core focus product. Core focus will be equity MF only. Right. On the NBFC, are we comfortable with our provision coverage ratio? In your opening comments, you did mention that NPAs are stable that way. But still we see a 103 bps increase in the NPA. Could that be somewhat streamlined? Okay. On the provision coverage ratio, it is driven by an established market practice of ECL, Expected Credit Loss, as per the accounting standards. We have adopted the policy defined by the accounting standards, and whatever is calculated by the policy of accounting standards, we are preparing the provisions. On the asset quality side, you see a growth in the overall year-over-year numbers. However, during the year, we had seen certain rise in the NPA numbers, which has come down in Q4 FY 2026. This rise was largely driven by the overall economic impacts which we had seen in the microfinance segment, but now things seem to be normalizing starting this quarter. Right. My next question is on the insurance side. We see a decline in the corporate side of the business, which we had seen previously as well. Is that segment in a bit of a doldrum? No. Overall, there has been a growth in the insurance premium, and a larger contribution has come from retail insurances rather than the corporate insurances. Right. There has not been major impact on the revenues. However, we had seen for last two quarters a slight reduction in the corporate insurance premium. During the last year, we had got insurance premium from certain government contracts. That was the larger reason why there was higher insurance premium in the previous financial year. When we compare that number to this year's number, you see a decline. However, the corporate insurance premium for the corporates, it is as per our expected range only. Right. One final question before I join back. On the mandate with the Assam Industrial and Green Growth Fund, as I see on slide 39, could you give some color on how will be the structure and how the things will proceed and whether FY 2027 is the year that we are looking forward to go about it? Government of Assam has mandated Choice Capital Advisors Private Limited to assist them in setting up the AIF and then doing the road shows for the fundraising for the AIF as well. Our role is to assist the government, although the fund management, et cetera, will be done by the government themselves. Okay. Thank you, sir. I'll join back. Thank you. Bye. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Shweta Sharma from Aryan Capital. Thank you, and go ahead. Thank you so much, sir. My first question is regarding revenue grew in FY 2026, but PAT margin remained robust, stable. What are the key levers that you are targeting to expand the net margin over the next two, three years? We have expansion in the net margins as well during this particular financial year. However, to expand the margins further, the larger use of tech is going to play a role. As we achieve the higher scale our fixed costs are not going to increase. You must have seen in the Q4 performance where the revenues have grown by, I think, 23%, but the profit has grown by 46% for FY 2026. So that higher growth than the revenue in profit after tax shows the higher expansion in the margins. So that will continue to expand as we leverage on the technology and the fixed costs remain stable. Okay. Sir, your acquisition of Optimo Investment Advisor and the IPPB partnership seems like a push into deeper tier 2 and tier 3 markets. So what is the projected customer acquisition cost for these channels compared to your traditional digital channels? Okay. Shweta, traditionally, we are largely focused on semi-urban geographies, tier 2, tier 3, tier 4 geographies, where we acquire customers. However, at the same time, the execution is completely digital and tech driven, which is through our mobile app or through our web trading platform, et cetera. But the acquisition is still physical, which is driven by branches, CBAs. Coming to your question on the acquisition, a partnership with the IPPB, we will be providing the services to their existing customer base, thereby making our customer acquisition negligible or at a very low levels because we will be earning revenues from the cross-sell, which we do to their existing customer base. So we don't see much of the customer acquisition cost increase while having a partnership with IPPB. Okay. Sir, as you scale the book, are you seeing any compression in yields? Specifically, what is the current GNPA and NPA trend in newly acquired Paisabuddy retail lending portfolio? The acquired portfolio is also behaving in line with our portfolio. When we had acquired, we had done a comparative study and the study stated that both the portfolios of Choice and Paisabuddy are similar in nature in terms of customer segment and geographies, whereby the performance is also similar. We don't see a differentiated performance in the portfolio acquired from Paisabuddy. Okay. Also, are you seeing any compression in yields? Definitely, as we grow higher and as we originate better credits, definitely there is going to be a rate reduction. However, that will be marginal, not a very significant impact in the compression of the NIM. But at the same time, the impact will be seen in the asset quality also, thereby increasing our ROE only and not having any negative impact on the ROE. Okay. Sir, my last question is, which segments will be the primary growth engines going forward? All four segments are focus segments for us. There is nothing primary or nothing secondary. There is no segment which is of non-core focus. All these are growing and all these will continue to grow in future as well. We have dedicated CEOs for all the segments and all business verticals, and thereby, the day-to-day execution and business decisions are taken care of by all of them. All of them will continue to grow and eventually become a larger organization in itself. Okay. Thank you so much, sir. That is all my side. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Suraj Shinde from Yes Securities. Thank you, and go ahead. Yeah. Hi, sir. Thank you for the opportunity. I have a few questions. My first question is that, as the base grows larger, what is your realistic medium-term growth guidance across revenue and profitability? Yeah. Hi, Suraj. Suraj, we have been constantly communicating as well as projecting internally to maintain a growth rate of around 30% on year-on-year basis across revenues and profitability. Okay. And sir, what are we doing to convert dormant Demat holders into active traders? What is the target activation ratio over the next 12 months? Okay. When we talk about the dormant Demat holders, there are different types of customers which we segregate internally, Suraj. These are classified into investors, traders and somewhat followers. These are the three categories which we classify in, and accordingly for each category, a different set of actions are taken to activate the dormant Demat holder. The largest push for activation is through our digital channels by understanding their other investments, by understanding their kind of investment philosophy, and then sending the nudges and sending the attractive opportunities to invest in the market. These are the steps which we take depending on the customer investment philosophy and customer behavior. Okay, sir. My last question is that, digital adoption is something that is rising right now. What percent of revenue is now coming from digital channels, and how do we see this moving? It's around 70% is coming from digital channels. When I say digital channels, these are trades executed on the platform. It can be our mobile app, it can be web trading platform. And offline channels include the call and trade facility and dealer terminals. So you can see 70% of the revenue is generated through trades placed on the online modes. Okay, sir. That helps. Thank you, sir. Thank you. The next question is from the line of Shruti Sharma from Family Office. Thank you, and over to you. Hello. Thank you for the opportunity. My first question is, could you share your near-term AUM target for the AMC segment for FY 2027 and also provide some color on the cost structure for running the AMC business? Okay. For one-year target, in the AMC business, we are expecting INR 1,000 crore to be the AUM at the close of FY 2027. Okay. In the insurance distribution segment, how is the corporate versus retail mix expected to evolve going forward? What is the target mix management is working on with? Okay. On the insurance side, we plan to keep a 50/50 mix between corporate and retail in future as well. Okay. That answers my question. Thank you so much, and all the best for next quarter. Thank you. Thank you. The next question is from the line of Nikita Mehta, an investor. Thank you, and go ahead. Thank you for the opportunity, sir. I have a couple of questions. Sir, Q4 growth looks strong. Did you see any slowdown in March and April due to market volatility, or has the momentum continued in FY 2027? Thank you, Nikita, for this question. Of course, there has been the volatility in the market. However, since our business is largely driven by the volumes, even in the volatile markets, the volume has remained on an upward trajectory, and therefore our revenues have grown in line with the growth in the overall volumes. We did not face much of the impact because of the market volatility. The same, we are expecting for FY 2027. Until and unless a larger geopolitical issue comes up, we do not foresee a major impact on the overall revenues. Okay, sir. And sir, what kind of ROCE and ROE thresholds do you target for the new investments? No. There are no new investments we are making, and there are no new segments in which we are expanding as of now. It's the existing businesses which we will continue to grow. Okay, sir. I think it answers my question, sir. All the best for the future. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Rohan Mehta, an individual investor. Thank you, and go ahead. Hi. Good afternoon, sir. Thank you for this opportunity. Sir, if you could touch upon the India Post Payments Bank partnership, for us, it is quite compelling with over one and a half lakh post offices and 12 crore odd customers. But it would be safe to assume that most of these would be relatively low-income or financially underserved customers who might have a limited capacity into SIPs. If you could shed some light on what your average SIP ticket size you would expect for this segment, and how the unit economics would pan out for us, compared to our existing wealth client base. Okay. Thanks, Rohan, for this question. Our arrangement with India Post Payments Bank is to provide a platform to the existing customers to invest in the mutual funds. That's the core role. There will be multiple activities which we will be doing while ensuring the goals of this particular partnership. The largest would be providing a digital platform, integrating our platform with the India Post Payments Bank's platform. That is number one. Number two will be to conduct an extensive training for the front office team of the India Post Payments Bank. Then number three is providing the services to the customers. Now, in this case, as your question is on the size of the SIP and assumptions on the low-income category customers, I would like to clarify here that the partnership is with India Post Payments Bank and not the post office. Although Post Payments Bank leverage the distribution platform, distribution channels, which is created by the post office, but the customers which are there on the India Post Payments Bank are not exactly the same customers as of the post office. They have higher investment capabilities because normally people tend to invest in the post offices in terms of recurring deposits model. However, nevertheless, coming to the size, it will definitely be lower as compared to the metro customer, but not as low as a post office customer as well. It will be lying somewhere in between. On a realistic target, we are expecting it will remain somewhere between INR 2,000 to INR 2,500 per customer per month. Okay. Got it, sir. Would you be looking at a sort of a break-even period by when the investment in this partnership will sort of start contributing to our bottom line? We will go live. Currently the tech integration is going on, and we will go live in this quarter. We expect that from the 1st of July, we will start having revenues in our balance sheet, and the profitability will start coming in. Okay. Got it, sir. That is helpful. Sir, just if I could ask, touch upon the advisory segment also, our order book on that front seems to have declined quarter-on-quarter. Which is a first in many of the historical quarters. This order execution running ahead of fresh order wins, is that the case, or are we seeing any slowdown in government project tendering, which might run into the next financial year's advisory revenues? If you could just Yeah. Comment on that. So no slowdown in the business per se. It is since being a Q4, the larger target was on executing the projects and completing this within the previous financial year itself. That is why you see a decline in this quarter first time. Until now, you must have seen the growth in the overall order book only. As the orders are executed, you can see a decline. But in this quarter, we are very confident that the pipeline looks very strong, and we will get more contracts, which will enable us to grow the order book compared to the previous quarter as well. Got it. Understood, sir. Just within this segment itself, would you be concerned about the concentration of orders that we have, particularly from the infrastructure consulting part or within Maharashtra as a state accounting for a fair share of our exposure? Is concentration a risk, and would we be looking to diversify and reduce these percentages? Of course, the contribution of these states and sectors are high, but we don't see a major immediate risk of this concentration. However, the focus of the management is definitely there to expand to other states as well. The others which you see in the earnings presentation includes 22 other states where we have the current orders live and where we are expanding our businesses as well. As the other states grow, this contribution definitely will come down. Okay. Got it. So within the next financial year, is it? Yeah. Over the next Yes. Sir, just one last question, if I may. Upon the AMC business, if you are going to be moving from passive to active strategies in the next fiscal year, in terms of active fund management and the sort of talent profile that might be required, are we looking at some new hiring in terms of fund managers? And if you have any threshold in terms of what kind of AUMs we should be dealing in the AMC business. On the team side, yes, definitely we are in talks with the industry experts and we are onboarding new people to expand the team. That is the first activity which we have been doing for some time now to build the base for the active strategies. This financial year, we will come up with the active schemes as well. Is there any other question? I missed the last part of your question. No. Sir, just in terms of the AUM threshold, if we have any or if we are going to have any minimum AUM that would contribute positively to our overall consolidated ROEs. Understood. For the AMC business, we are targeting an AUM of 1,000 crores for FY 2027. Got it. Okay. All right. Sir, that's very helpful. Thank you for taking my questions, and all the best, sir. Thank you. Thank you very much. Thank you. A reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Nishita from Crown Capital. Thank you, and please go ahead. Yes. Hello. Yeah. Hi, Nishita. Yeah. Hi. I just had a follow-up on the previous participant's question. You mentioned that the order pipeline is quite strong, and you see good orders coming in in Q1. If you can quantify what is our current order book, and how does the pipeline look like? Current order book is INR 698 crore. The current projects that we have submitted our bids, as these orders are awarded by way of tendering, are more than INR 400 crore. Okay. What is generally our winning ratio? It depends on location to location, and there cannot be a generalized winning ratio, but it all depends on various factors. I mean, that is not a relevant kind of metrics. Okay. Got it. Thank you so much. Thanks. As a reminder to all the participants that you may press star and one to ask a question. The next question is from the line of Ritvi Gandhi, an investor. Thank you, and go ahead. Hello. Good evening, sir. Am I audible? Yeah. Hi, good evening. You are very well audible. Yes. Hi. My first question is that how does the management expect the revenue mix to evolve over the next three years, as the AMC and BFSI and IB businesses scale? Okay. All these businesses are classified into three segments: broking and distribution, advisory, and NBFC. We expect all of them to grow at a faster pace and the mix will remain somewhere between 50, 40, and 10 kind of ratios. 50 for broking and distribution, 40 for advisory, and 10 for the NBFC. Understood. Also, sir, do we have any plans to monetize our advisory capabilities separately? What do you mean by monetizing the capabilities separately? As you said earlier that our primary and secondary, we do not have any preferences as in our primary and secondary categories business-wise. But other than that, do we have any plans to go aggressively on the advisory ring or the advisory business? No, advisory is definitely a core function of the company, and there is a dedicated team of roughly around 2,000 people in the government advisory business. There is a team of more than 150 employees in the investment banking team. We have dedicated teams, dedicated leadership, dedicated business and execution heads. All of them are taking care of the businesses very well. And definitely these are going to grow at a higher pace. There is no specific preference per se to give primary focus to any business from the holdco management side. Understood. Thank you so much. Thanks. A reminder to all the participants that you may press star and one to ask a question. The next question is from Ramesh Turani, from Mehta Brothers. Thank you, and please go ahead. Good evening, sir, and thank you for the opportunity. Sir, just wanted to understand what steps are we taking or what initiatives we are undertaking on the AI part of the business? Like, how do we plan to implement AI in generating additional revenues and generating additional benefit to our customers? Yeah, sure. We have established a dedicated team to implement AI across all business verticals. There have been specific sections which we have automated with the use of AI across all businesses already. Largely, the AI's use is on the data analytics and preparing the summarized outcome or the actionables for that particular activity that we have established currently for the back office and data analytics kind of functions. That is there in place. As we develop new models on the AI, we will keep implementing on the front-end customer-facing activities as well, subject to regulatory compliance. Because, sir, from what we understand is, a few of the competitors on the broking side, they have been building some AI layers and some capabilities in their strategies as well. How are we planning to give something different to our customers? Just wanted to understand your thoughts around that as well. In our case, as I mentioned, that analytics is the larger part which we are doing for the broking business also. Take an example, that now AI decides that which customer should get which notification at what time, so that he gets the right information at the right time. These are the kind of activities which we have piloted with the use of AI and we will be implementing in the due course as the models mature. Okay, got it. Sir, just wanted to understand on the capital allocation side, since we have multiple businesses and we have an AMC, we have a broking business, we have a BFSI business, advisory business. How do you plan to allocate the capital requirements and also on the bandwidth of the management? Are there separate heads and then how the structure works? If you can just elaborate on that. Okay. On the bandwidth of management side, we have dedicated CEOs for each of the businesses who takes care of the day-to-day business operations and the growth strategies. At the holdco level, we decide an AOP, annual operating plan, at the beginning of the year, and then we do a tracking on a regular month-on-month basis. There is no challenge from the management bandwidth or management availability side. That is on the manpower aspect. On the capital aspect, we have enough internal accruals as well to support all businesses. Although all of our businesses are self-sufficient now, where they do not need much of the capital. However, as far as the growth capital is required, the holdco is sufficiently capable to support any of the business required. So there is no preference there as well. As and when required, any business needs growth capital, we are capable to support the business in terms of capital aspect as well. Good to understand that part. Sir, any thoughts around maybe demerging these businesses and listing them separately in the near term or any thoughts around that? No, not immediately. Of course, the value unlock will be one of the target, but there are no immediate plans to do so. Okay. Got it. Thank you, sir. Thank you for the opportunity and all the best, and looking forward to interacting with you next quarter. Thanks. Thank you very much. Thank you. As there are no further questions from the participants, I now hand the conference over to Mr. Arun Poddar for closing comments. Thank you. Thank you all the participants. Thank you for your questions and continued engagement. In FY 2026, our effort have been centered on growing the business in a balanced and disciplined way. As we move forward, our priorities will be to strengthen our technology capabilities and further expand our presence. Thank you. Thank you, everyone. On behalf of Choice International Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.