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Motilal Oswal Financial Services Ltd. announced its results for the quarter ended June 30, 2023 post approval by the Board of Directors at a meeting held in Mumbai on July 27, 2023.

Performance for the quarter ended June 30, 2023:

• Consolidated revenue stood at Rs 1,264 cr, up 32% YoY/11% QoQ in Q1FY24.
• Consolidated operating profit after tax (PAT) for Q1FY24 was Rs 240 cr, up 28% YoY/3%QoQ in Q1FY24.
• Capital market business PAT was Rs 155 cr in Q1FY24, up 63% YoY/15% QoQ.
• Asset & Wealth businesses PAT was Rs 64 cr in Q1FY24, up 10% YoY.
• Housing finance business PAT was Rs 29 cr in Q1FY24.

Speaking on the performance of the company, Mr. Motilal Oswal, MD & CEO said “We have delivered strong performance in Q1FY24. Our Capital market business has demonstrated remarkable performance, reporting an all-time high profit and strengthening our retail market position in Cash and F&O segment to 6.2% & 7.2% respectively. We continue to focus on our strategy to diversify our businesses towards linear sources of earnings. Our Asset and Wealth Management AUM has surpassed an impressive milestone by reaching Rs 1.25 lakh cr. Our Asset Management business has seen improvement in performance and is likely to gain from process driven investing and its niche offerings. The Wealth Management business is on its way to achieve scale as we have strengthened our leadership team and continued investments in Relationship Managers. Additionally, we are pleased to share that our PE business is gearing up to launch its 6th Real Estate fund in the upcoming quarter, adding to our diverse investment products. Furthermore, the recent appointment of new senior management personnel has further bolstered our Housing finance business, enhancing its potential for growth and success. We firmly believe that each of our businesses possesses immense potential and is well-positioned to leverage the numerous opportunities present in the market. As we move forward, we shall continue to pursue our strategic objectives diligently, aiming for sustained growth and continued excellence across all our operations.

Performance of Business Segments for the quarter and year ended June 30, 2023

 * Capital markets Businesses (Broking & Investment banking)

*    Capital markets comprise of Retail Broking and Distribution, Institutional Equities and Investment Banking business. Revenues for this segment were Rs 879 cr, +44% YoY/18% QoQ in Q1FY24.

*    PAT grew by 63% YoY/15% QoQ to Rs 155 cr in Q1FY24.

*    In Retail Broking & Distribution, Retail Cash ADTO market share grew by 46 bps YoY/110 bps QoQ to 6.2%. Retail F&O Premium market share stood at 7.2% 

*    Retail F&O ADTO market share grew by 111 bps YoY/44 bps QoQ to 4.3%. Overall ADTO grew 171% YoY / 28% QoQ.

*    NSE active clients stood at 7.6 lakhs as of June 2023 and market share was stable at 2.5%. Acquired around 1 lakh clients in Q1FY24.

*    Distribution AUM grew by 20% YoY at Rs 22,288 cr as of June 30, 2023. Distribution Net Sales of Rs 317 cr during Q1FY24.

*    Currency market share improved to 22.7%, +415 bps QoQ.

*    Institutional equity business ADTO grew 67% YoY/62% QoQ.

*    Institutional Equities team wins big in Asia Money Brokers Poll 2022. Ranked #1 Corporate Access Team and #2 Sales Team and Execution Team.

*    Investment Banking successfully completed 6 deals worth Rs 3,730 cr in Q1FY24. Further, there is a strong pipeline of ECM mandates, which is expected to fructify in coming quarters.

 * Asset & Wealth Management businesses (AMC, PE and PWM)

 * Overall Asset and Wealth Management revenues were Rs 241 cr in Q1FY24, up 10% YoY. Profits were Rs 64 cr in Q1FY24, up 10% YoY.

*    Asset Management business AUM across MF, PMS & AIF stood at Rs 51,520 cr, +19% YoY/13% QoQ. Revenues for Q1FY24 stood at Rs 138 cr, +5% QoQ.

*    MF AUM stood at Rs 33,460 cr. Strong performance in Active MF schemes resulted in 89% YoY growth in Gross Sales.

*    Added around 1.3 lakh new SIPs in Q1FY24, up 171% YoY/42% QoQ. SIP flows market share improved by 30 bps YoY.

*    Our share of Alternate assets, comprising of PMS & AIF, is one of the highest among AMC peers at ~35%.

*    Launched Motilal Oswal Nifty Microcap 250 Index Fund, industry’s first Microcap Fund. The NFO received overwhelming response garnering Rs 120 cr from 26k+ investors.

*    Private Equity business fee earning AUM of Rs 9,940 cr across 3 growth capital PE funds and 4 real estate funds. In Q1FY24, revenues grew by 22% YoY at Rs 39 cr.

*    Wealth Management business AUM grew by 93% YoY/28% QoQ at Rs 66,400 cr as on June 30, 2023. Strong net sales of Rs 1,880 cr in Q1FY24, +51% QoQ. Wealth business revenue grew by 35%       YoY to Rs 64 cr in Q1FY24.

*    Added gross 22 RMs in Q1FY24, taking total count to 197 RMs as on June 30, 2023. We will continue to invest in this business by further RM additions.

*  Housing finance business

 * Appointed Sukesh Bhowal as Chief Executive Officer. He has 27 years of rich experience in mortgage lending.

*    Motilal Oswal Home Finance reported profit of Rs 29 cr in Q1FY24.

*    NII grew by 7% YoY in Rs 76 cr and NIM stood at 7.6% in Q1FY24.

*    AUM grew by 6% YoY to Rs 3,780 cr as on June 30, 2023.

*    Disbursements stood at Rs 93 cr in Q1FY24.

*    Yield on advances increased to 14.5%, up 80 bps QoQ and spread stood at 6.1%.

*    Net Gearing stands at 2.1x and Tier 1 CAR remains robust at 48%.

Fund based investments includes sponsor commitments to our AMC, PE funds, RE funds and strategic equity investments.

*    Total investment including unrealised gains was Rs 5,080 cr as of June 30, 2023.

*    Total equity investment including alternate funds was at Rs 4,730 cr as of June 30, 2023 which generated XIRR of 17% since inception.

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