Motilal Oswal Financial Services conducted a conference call on 22 July 2016 to discuss the financial results for the quarter ended June 2016. Sameer Kamath, CFO of the company addressed the call:

Highlights:

• The company has posted 72% growth in consolidated revenues to Rs 3.7 billion in Q1FY16, while consolidated PAT moved up 179% to Rs 79.2 crore. Housing finance and Asset Management Businesses contributed to the healthy growth in revenues,
• The company has also made exceptional gains comprising of share in profit on sale of investments (carry share) made in the 1st PE growth fund, as well as the impact of write-off on account of doubtful NPA.
• Balance sheet had networth of Rs 15 billion and gross borrowings of Rs 36 billion at end June 2016.
• The employee base of the company stood at 3000 employees at end June 2016.

• The average daily trading volumes of the company increased 34% to Rs 75 billion in Q1FY2017, against market growth of 2% to Rs 3.2 trillion.
• Equity market share improved to 2.4% in Q1FY2017 from 1.8% in Q1FY16.
• The blended yield was 3.1 bps in Q1FY2017.

• Investment banking fees were Rs 82 million in Q1FY2017, up 699% YoY.
• ECM business has gained momentum, and the company completed the Rs 7.5 billion Parag Milk Foods IPO and the Rs 2.6 billion Indian Overseas Bank QIP

• Asset Management fee were Rs 652 million in Q1FY2017, up 62% YoY. This contributed 18% of consolidated revenues this quarter, as compared to 19% in Q1FY16.
• Total AUM/AUA across mutual funds, PMS and PE businesses was Rs 151 billion, up 58% YoY.
• Mutual fund AUM was Rs 59 billion, up 84% YoY, and PMS AUM was Rs 64 billion, up 56% YoY.
• Rank in equity AUM improved to 12, up from 18 in FY14. Market share in Equity MF AUM was 1.3% in Q1FY17 and in Equity MF Net Sales was 4.0%. These reflect considerable headroom for growth.
• In private equity, the 1st Growth Capital Fund - IBEF I has returned 198% capital (in INR terms) from 4 full-exits and 4 partial exits in 3 companies till-date. The fund is in advanced stages for 3 exits in the next few months, which may allow it to return an additional 20% capital. The fund is likely to deliver a gross multiple of over 3.5 times.
• The 1st Real Estate Fund - IREF I has returned 86% capital from full/partial exits from 6 projects.
• The 2nd Growth Capital Fund - IBEF II has committed 64% across 8 investments.
• The 2nd Real Estate Fund - IREF II has committed 85% across 8 deals.
• The 3rd Real estate Fund - IREF III announced its 1st close, raising commitments of Rs 6 billion.

• Wealth management assets were up 54% YoY to Rs 74 billion.
• the traction in RMs from 54 to 75 YoY has led to a 54% YoY growth in AUM and a 28% YoY rise in clients

• Housing finance related income was Rs 1 billion in Q1FY17, up 391% YoY.
• HFC loan book stood at Rs 25 billion vs Rs 5.6 billion a year ago. It has funded 25,000 families till-date.
• Aspire disbursed Rs 4.8 billion in Q1FY17, up from Rs 2 billion in Q1FY16.
• It currently operates in 4 states, and the branch count has increased from 28 to 62 YoY
• It has credit lines from 23 banks and 1 NBFC, up from 8 a year ago.
• As of Q1FY17 (on an annualized basis), NIM was 380 bps, RoA was 3.5%, RoE was 16.6% and D/E was 5.7X. Gross NPL was 0.2% as of Jun 2016.
• Capital infusion made by the Sponsor is Rs 4 billion till-date.
• Housing Finance contributed 27% of consolidated revenues this quarter, as compared to 10% in Q1FY16.
• The housing finance company operates through 62 branches spread across 4 states – Maharashtra, Gujarat, Madhya Pradesh and Telengana. The branch expansion is taking place at hefty pace of 20-25% quarter over quarter. The company propose to expand to three new states, while would continue to expand at strong pace.

• Fund based income was Rs 459 million in Q1FY17, up 61% YoY. This includes share in profit on sale of sponsor investments made in the 1st PE growth fund.
• Investment in own mutual fund products is Rs 6.1 billion (at cost) and Rs 1.9 billion (at cost) in our own private equity products. The unrealized gain on MF investments was Rs 1.8 billion as of Jun 2016.
• NBFC loan book, which is now being run as a spread business using borrowed funds, was Rs 2.6 billion.