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    Choice Intl.

    CHOICEINGood
    Financial Services·23 Apr 2025
    Management Summary

    Choice International delivered a strong performance in its maiden earnings call, characterized by robust growth across its three core verticals: Broking, NBFC, and Advisory. The company is aggressively pursuing a 'phygital' strategy, expanding its physical footprint into Tier 3 cities while leveraging in-house technology. Strategic acquisitions in the wealth management and lending spaces have significantly boosted AUM and loan books, setting a high growth trajectory for FY26.

    Highlights

    7

    • Full year FY25 revenue reached ₹921.70 crores, representing a 21% YoY growth.

    • Q4 FY25 EBITDA stood at ₹98.30 crores, a significant 42% YoY increase with margins expanding to 38.54%.

    • Full year PAT grew 24% YoY to ₹162.70 crores, with Q4 PAT rising 36% to ₹53.5 crores.

    • Wealth Product Distribution AUM surged 793% YoY to ₹5,500+ crores, aided by the Arete Capital acquisition.

    • NBFC loan book reached ₹768 crores with a healthy NNPA of 0.83% and CRAR of 38.62%.

    • Advisory business maintains a robust order book of ₹500+ crores, primarily focused on government infrastructure projects.

    • Branch network expanded to 192 offices, with a target to add 100 more in FY26.

    Key financials

    Single quarter

    06 metrics
    1. 01Revenue₹921.7 Cr+21%YoY
    2. 02EBITDA Margin32.1%
    3. 03PAT₹162.7 Cr+24%YoY
    4. 04GNPA2.5%
    5. 05NNPA83%

    Segment breakdown

    • Broking and Distribution₹551.2 Cr60.2%
    • NBFC (Choice Finserv)₹114.8 Cr12.5%
    • Advisory₹250.3 Cr27.3%
    Donut· Share of Revenue

    Guidance & targets

    4
    CategoryTargetPriority
    Revenue
    NBFC Business Growth CAGR
    25-30%
    		Medium
    Revenue
    Broking Business Growth CAGR
    30-35%
    		Medium
    Headcount
    Branch Network Expansion
    100 branches
    		High
    Other
    District Presence
    800 districts
    		Medium

    Risks & concerns

    3
    RiskSeverity

    Asset Quality in NBFC

    GNPA stands at 2.49%; management highlighted a robust underwriting process and a shift toward prime borrowers to mitigate risk. — Analyst acknowledged

    medium

    Market Volatility Impact

    Broking and wealth businesses are sensitive to market cycles, though management claims the Advisory vertical provides a macroeconomic hedge. — Analyst acknowledged

    medium

    Integration of Acquisitions

    Recent growth is heavily reliant on integrating Paisabuddy, Sureworth, and Arete Capital successfully. — Management acknowledged

    low

    Q&A highlights

    3

    “We largely focus on the physical infrastructure. We largely focus on the customers who are into semi urban... we prioritize the handholding of customers across their whole financial services journey.”

    Clarifies Choice's strategy of using physical presence in Tier 3 cities to differentiate from pure-play digital brokers like Angel One.

    asked by Shubham Poruhit, SBI Securities

    2 min read5 chapters

    Detailed Narrative

    01

    Strategic Pivot to 'Phygital' Expansion

    Choice International is aggressively expanding its physical footprint, moving from 115 to 192 branches in FY25. Management plans to add another 100 branches in FY26, with a long-term goal of covering all 800 districts in India within five years. This strategy targets the 'new entrants' in financial services from Tier 3 and below geographies who prefer physical handholding over pure digital interfaces.

    02

    Inorganic Growth Bolsters NBFC and Wealth Segments

    The company's growth in FY25 was significantly accelerated by strategic acquisitions. The acquisition of Arete Capital increased Wealth AUM nearly 5-fold to ₹5,500+ crores. Similarly, the slump sale acquisitions of Paisabuddy and Sureworth drove a 53% jump in the NBFC loan book, which now stands at ₹768 crores with a consolidated yield of 20.5% to 21%.

    03

    Advisory Vertical as a Macroeconomic Hedge

    The Advisory business, contributing 26% of total revenue, serves as a stabilizer during market volatility🌐. With an order book of ₹500+ crores focused on government missions like the Jal Jeevan Mission, this segment provides predictable revenue streams. Management noted that 60-65% of the current order book is tied to water-related infrastructure projects across 10 states.

    04

    Asset Management Entry on the Horizon

    Following in-principle approval from SEBI in December, Choice has applied for final approval to launch its Mutual Fund business. The company expects to begin operations within six months, initially focusing on Exchange Traded Funds (ETFs). This move aims to complete their financial services ecosystem, allowing them to cross-sell products to their 10 lakh+ Demat account holders.

    05

    Insurance Distribution Scaling Rapidly

    The insurance arm sold over 52,000 policies in Q4 FY25 alone, generating ₹93 crores in premium. The company is leveraging a POSP (Point of Sale Person) model with 7,300 registered partners to drive growth. Management expects insurance to eventually become a standalone reporting segment as it continues to scale through retail and corporate cross-selling.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.