Detailed Narrative
Strategic Pivot Yields Strong Two-Year Growth
JM Financial's strategic pivot, initiated in May 2024, has delivered robust performance over the past two years. The Corporate Advisory and Capital Markets (CACM) segment's revenue grew 26% from INR 592 crores to INR 946 crores, with operating profit before tax increasing from INR 328 crores to INR 452 crores, maintaining a 48% margin. Overall fees, commission, and brokerage across CACM and Wealth Management saw a 10% YoY growth, reaching INR 1,753 crores.
Private Markets De-risking and Re-orientation
The Private Markets segment has undergone significant de-risking, with substantial repayments and prepayments on the real estate side. The loan book, which stood at INR 10,000 crores in FY24 and INR 5,000 crores in FY25, is now at INR 4,000 crores, with a target to grow 15-20% YoY to INR 5,000 crores by March 2027. The segment achieved over INR 270 crores in recovery in FY26, on track for INR 250-300 crores in FY27, and aims for a debt-equity ratio not exceeding 2:1 or 3:1.
Wealth and Asset Management Expansion
Wealth Management recorded 17% revenue growth and over 40% profit growth in the last two years, expanding its RM strength by 30% YoY to 1,046 employees and growing recurring AUM by 10% YoY to INR 31,000 crores. Asset Management saw 38% revenue growth, with mutual fund management fees increasing 65% to INR 44 crores in FY26. The company expects a significant close for its AIF products by year-end, with the pre-IPO fund targeting over INR 1,000 crores.
Affordable Home Loans Sustained Performance
The Affordable Home Loans business continued its strong trajectory, with AUM increasing 22% YoY to INR 3,460 crores and revenue growing 25% YoY to INR 455 crores in FY26. The segment's operating profit after tax after minority interest grew 45% YoY to INR 74 crores, maintaining robust asset quality with a gross NPA of 0.5% and collection efficiency of 99.4%. The company targets an IPO for this business by 2028-29 and 25% YoY AUM growth.
Capital Markets Pipeline vs. Volatility
Despite a strong IPO pipeline of INR 140,000 crores (up from INR 45,000-50,000 crores previously), execution has been slow due to market volatility🌐, FPI selling, and conservative domestic mutual fund pricing in Q4 FY26 and Q1 FY27. Management anticipates the second half of FY27 to be more favorable for execution and is actively exploring alternative capital solutions like private equity and structured credit for clients.
Long-Term Financial Goals and Shareholder Returns
JM Financial's long-term aspiration is to achieve 15% revenue growth and 15% Return on Equity (ROE) across its businesses. The company remains committed to a 50% PAT dividend payout ratio, having paid or proposed an aggregate dividend of INR 5.95 per share (totaling INR 570 crores) over the last four quarters. The focus is on building scale with profitability and enhancing shareholder value through strategic investments and operational efficiency.