Anand Rathi Unlisted Shares Essentials

Anand Rathi shares and stock brokers limited, AR Venture Funds Management and Anand Rathi financial services entered into an agreement to acquire Religare Wealth Management on Feb 17, 2017 and completed the acquisition in early 2017.

• The company has a strong brand name, they operate business under the aegis of ‘ANANDRATHI'. According to the company their business prospects and ability to attract clientele are, to a certain extent, dependent on the strength and reputation of the brand name.
  
• Anand Rathi Wealth Ltd has higher ROCE Ratio. Company’s ROCE Ratio is 24.88% against peers ROCE i.e. between 12-22%.
• The Anand Rathi group expects 15.0% CAGR returns from frontline indices next 10 years basis.
  
• Company is working on digitalization which is helping it in making its processes paperless, efficient, easy and real-time. It is expected to enable platform convergence and may create opportunities for new client engagement. 
• According to company their robust and readily available technological solutions enabled customers and employees to continue to function and interact seamlessly despite the unprecedented complex environment created by the COVID-19 pandemic, which has given them a competitive advantage during this period.

• Company’s operating margin FY20 stood at 25.06%, which is lowest among its peers, however the company is striving had to yield good returns from its investments and changed business model
• Company saw a decline in the revenue from operations and profits, it was primarily due to the adverse effect of the COVID-19 pandemic, extended period of business disruptions, stock market volatility and decrease in investor’s sentiments for new investment in the initial phase of the COVID-19 pandemic. 
• According to recent amendment of SEBI the same client cannot be offered both advisory and distribution services within the group of the non-individual entity by a single company. This made the company to discontinue some of its operations.

• Increase in the wealth of global Indians and a rising share of the organized market players such as independent wealth advisors and small brokers/agents as financial advisors are fueling growth in the wealth management market.
• Since the COVID-19 period has forced branch lockdowns leaving investors no option but to use online and digital services, the firms could see possible drive and upsurge in demand for digital channels and therefore the need to upscale and upgrade them.
• Company have huge upside growth potential as there is low penetration of distributors in the country, with only a small number of distributors catering to the large population base.
  
• In 2018, top 8% of the total population in India represents 45% of the total wealth and of the above only 20% take advice from wealth managers. increase in start-ups and rising income levels may drive growth of young HNI population in India; there is a big opportunity for a wealth management firm to tap into an underpenetrated market
• The current wealth management market in India is at the early stages of development. Until now, the focus of established players was on the urban segment, still companies have the opportunity to grab the attention of HNIs residing in rural areas.
  

• The current pandemic situation results in stock market volatility because of macro headwinds such as rupee depreciation and crude prices, as well as the liquidity crisis that hit the financial sector after defaults is expected to bring challenges for the company as the investors are hesitant to invest in the market.
• With rising use and adoption of different technologies, there has been growth in data breaches and cyber-attacks in the recent years. As these institutions hold a lot of private data, any leak can take a significant hit on their brand image.
• The Indian wealth management industry is primarily regulated by the SEBI. Over the years, especially after the 2008 economic downturn, SEBI has introduced regulations to protect customers. These regulations have severely limited the abilities of wealth management companies, resulting in low revenue generation.
• Wealth management firms need to adopt technological advancements and provide individualized, comprehensive advice aligned with the changing investment trends and needs. Constant innovation and new ways to deliver services may continue to disrupt the industry.