Wealth First’s Q2 profit fell 47%. Yet its core business, recurring commissions earned on client assets, posted its highest-ever quarter. The decline came from one-off income that didn’t repeat, plus spending on a new asset management company (AMC) and an insurance broker.
The harder questions sit elsewhere. Trail revenue grew 4.7% while the advisor team grew 45%. And the company is buying a Mumbai wealth firm owned by its own promoter group. Our notes from the presentation are below, but before that:
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From ₹9,000 cr to ₹20,000 cr: Wealth First’s five-year plan
Q2 FY27 in numbers
Where the revenue went
- Recurring revenue grew; transactional revenue collapsed. Trail revenue rose 4.7%, but other operating revenue fell by about ₹17 cr. The deck attributes this to one-time insurance income and secondary-market broking in H1 FY26 that didn’t repeat.
- Other income did a lot of the work. It was ₹6.6 cr in H1, about 29% of PBT. It came from profit booking and mark-to-market gains on the company’s own investments.
- That income is volatile. Wealth First holds about ₹120 cr of investments and securities on its balance sheet, against ₹185 cr of equity. So treasury gains can swing profit noticeably in either direction.
The core business: steady, not fast
- Read the growth labels carefully. The deck’s headline “+21.4%” and “+22.2%” figures are four-year CAGRs. Year-on-year, trail revenue grew 4.7% and trail-earning AUM grew 7.1%, to ₹6,438 cr.
- The year before was weaker still. Trail-earning AUM grew only about 2% from Sep-24 to Sep-25.
- Total assets under advisory (AUA) reached ₹13,798 cr, up 9.7% year-on-year. But only mutual funds, PMS and AIFs earn recurring trail, and those are about 47% of the total. The fastest growth is in bonds and PMS/AIF, but bonds don’t earn trail revenue.
More advisors, same revenue (for now)
- Advisors: relationship managers rose to 58 from 40 a year ago (+45%). Of these, 45% have been with the firm for under three years.
- Clients: total clients grew 4.3% to 22,146, and client families grew 4.8% to 7,039. About 80% of clients have stayed more than five years, which shows strong loyalty.
- Headcount: total employees rose to 105 from about 80.
- Concentration: about 70% of clients are in Gujarat
Costs: the price of building new businesses
- Operating costs rose 51%. The cost-to-income ratio was 55.4% in Q2, or 41.5% excluding the AMC. That implies the AMC cost about ₹2.4 cr in the quarter (my calculation).
- Some of the increase is seasonal. Employee costs are usually higher in Q2 because appraisals and incentives are paid then.
- Management’s view: these are setup costs that will “normalise” once the AMC and insurance businesses start earning revenue.
The new businesses
- Lakshya AMC (69.7% owned, about ₹41 cr invested): partnered with the founders of Benchmark AMC, who launched India’s first ETFs. It holds a SEBI licence, but no product has launched yet. The flagship ETF’s scheme document was resubmitted after SEBI feedback. A second product, an offshore fund investing in US index options, is being prepared for residents and NRIs, subject to approvals.
- Wealthshield Insurance Brokers: FY26 premium book of ₹78 cr, up 30%. The deck says it has moved past team-building into distribution, and a GIFT City product tie-up is “under discussion.”
- NRI PMS: a Nifty 100 index portfolio for US and Canadian tax residents, designed to avoid the punitive US tax rules (PFIC) that apply to Indian mutual funds. The first investors have been onboarded.
We track companies with solid balance sheets, low-key execution, before they show up on everyone’s radar — and break down the numbers that actually matter in our research.
As always, this is not a stock recommendation — This note is for informational purposes only and not a buy/sell recommendation. Please do your own due diligence before investing.
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Ekansh Mittal
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