Nuvama Wealth Management Ltd – Q3 FY25 Concall Summary
Q3 saw significant volatility due to macro and geopolitical events, as well as regulatory changes like SEBI’s F&O regulations, impacting broking revenues.
Strong Performance Continues:
- Client Assets: ₹4.5 lakh crore (+36% YoY).
- Revenue: ₹723 crore (+30% YoY).
- PAT: ₹252 crore for Q3 and ₹731 crore for 9M FY25 (+76% YoY).
- ROE: Stable at 32% for 9M FY25.
Key Business Highlights:
Wealth Management:
- AUM crossed ₹1 lakh crore (+38% YoY).
- Focus on managed products (PMS, AIF, MF) with 65-70% of new flows.
- Strong net new flows of ₹5,800 crore in 9M FY25, matching FY24 full-year flows.
- RM (Relationship Manager) count: 1,237, with ongoing productivity improvements.
- Targeted cost-to-income ratio reduction from 65% to 60% in coming years.
Nuvama Private:
- AUM at ₹2.1 lakh crore (+24% YoY).
- ARR net flows of ₹8,000 crore in 9M FY25 (+88% YoY).
- Offshore expansion progressing via DIFC (Dubai); First location in DIFC is live, with business and revenue generation underway. Expected to break even in 6-9 months.
- Singapore plans under consideration.
Asset Management:
- AUM of ₹11,300 crore with ₹1,200 crore net inflows in Q3.
- Launched Flexicap fund and closed first CRE fund at ₹1,700 crore.
- Filed for SEBI’s new Specialized Investment Fund (SIF) license - to offer strategies like long-short and absolute return with a lower minimum ticket size (INR 10 lakh).
- GIFT City: Expanding into GIFT City to attract offshore money
Asset Services:
- Segregated as a standalone vertical.
- AUC grew 57% YoY to ₹1.3 lakh crore.
- Dominant domestic market share (22% of incremental AIF/PMS registrations).
Capital Markets:
- Institutional equities saw volume softness in Q3, but market share maintained at 6.2%+.
- Investment banking market share in fundraising stood at 18% (₹25,000 crore across 11 deals).
- No major slowdown in the deal pipeline; spillover expected in Q4.
Strategic Focus Areas:
- Scale and Growth via geographical expansion and capacity building.
- Capital Efficiency, particularly in lending.
- Enhancing Revenue Granularity with ARR-based assets.
- Technology Upgradation with tools like the proprietary NUWAI (AI-driven training).
Guidance and Outlook:
- Expecting recovery in NII and yield normalization in Q4.
- Sustainable AUM growth of 25%+ over the medium term.
- Continued focus on offshore expansion and productivity ramp-up.
- Minimal impact from MLDs (less than 1% of revenue).
- Cautiously optimistic despite global macro uncertainties.
Source: Latest Concall Transcript