Abans Financial Services Limited (AFSL) Earnings Call Transcript
May 30, 2025
Earnings Call Speaker Segments
Ladies and gentlemen, good day, and welcome to the Q4 and FY 2025 Earnings Conference Call of Abans Financial Services Limited, hosted by Valorem Advisors. [Operator Instructions] Please note that this call is being recorded. I now hand the conference over to Ms. Purvangi Jain from Valorem Advisors. Thank you, and over to you.
Good afternoon, everyone, and a very warm welcome to you all. My name is Purvangi Jain from Valorem Advisors. We represent the Investor Relations of Abans Financial Services Limited. On behalf of the company, I would like to thank you all for participating in the earnings call for the fourth quarter of the financial year 2025. Before we begin, let me mention a short cautionary statement. Some of the statements made in today's earnings call may be forward-looking in nature. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ from those anticipated. Such statements are based on management's belief as well as assumptions made by and information currently available to the management. Audiences are cautioned not to place any undue reliance on these forward-looking statements in making any investment decisions. The purpose of today's call is purely to educate and bring awareness about the company's fundamental business and financial quarter under review. Now let me introduce you to the management participating with us in today's call. We have with us Mr. Dhrumil Shah, Vice President; Mr. Ketur Shah, Vice President; and Mr. Nirbhay Vassa, Chief Financial Officer. I now hand it over to Mr. Nirbhay Vassa for his opening remarks. Thank you.
Good afternoon, everyone, and thank you, Purvangi. I'd like to welcome all of you to our FY '25 Q4 and annual earnings call. I appreciate your time and continued interest in our company. Let me begin by walking you through the financial highlights for the quarter. EBITDA for the quarter came in at INR 47 crores, representing a 27% increase over the same period last year with margins improving. Net profit for the quarter was at INR 30 crores, up 43% year-on-year. Turning now to the full year performance for the year ended March 31, 2025. EBITDA stood at INR 188 crores, up 25% year-on-year with EBITDA margins improving, and net profit for the year was at INR 109 crores compared to INR 89 crores in FY '24, delivering a 22.5% year-on-year growth. Operational highlights for the business were as follows. Our total assets under management as of the year ended 31st March, 2025 stood at INR 3,200 crores approximately. A key growth driver has been our global arbitrage fund contributing INR 831 crores, over 25% of our total AUM. It continues to attract strong investor interest, especially from those seeking risk-adjusted returns in a volatile market. Our fee-based investment services business has demonstrated consistent and meaningful progress. In FY '25, this segment contributed 70% of the overall EBIT compared to 50% in the previous year and 25% in the year before, reinforcing our strategic focus on building a sustainable annuity-like income stream and fee-based business. Our NBFC business continues to maintain a strong capital position for capital adequacy ratio of approximately 24%. Our lending book stood at INR 350 crores approximately, of which 75% (sic) [ 76.6% ] is to non-group entities. The exposure of the NBFC is diversified and risk adjusted. Overall, the performance in this year reflects a well-diversified, balanced and strategically aligned business model with a sharp focus on growth, prudent risk management and long-term value creation. With that, we can now open the floor for Q&A. I look forward to addressing your questions.
[Operator Instructions] We have a question from [ Vishal Balada ], an individual investor.
So yes, I had a question regarding what would be the sustainable EBITDA margin for us. Because I guess, last year, we had been around 14% margin. And in the previous quarters, it is just a single digit. So...
Okay. Thank you for your question. So I have explained this in previous calls also, but for the benefit of everyone on today's call, I will reiterate that there are -- this is a multifaceted business. So if you have access to the numbers and you go to your segment report, right, that is the true indicator of margins if you really want to see it. Because the principal investment and treasury business includes physical trade of commodities as well as capital market trades, right? So there is no fixed margin on that particular element because that's just an element of how much money is available for you to take a treasury trade, right? So if you see from a consistency standpoint, the fee-based investment services business has grown from INR 100 crores to INR 165 crores, which has made you INR 102 crores in the current year compared to INR 58 crores in the last year. So if -- the margin was 58% for fee-based business last year, it is -- just one second -- approximately improving because as the fee-based business expands, right, the cost element does not go up substantially. And even for the lending business, the margins are staying intact. You can see more than INR 38 crores top line, it's making INR 24 crores vis-a-vis on a INR 35 crores top line was making INR 23 crores. So if you try to calculate an EBITDA margin or our PAT margin for the whole number, it is not how I would look at the business, and hence, I'm trying to draw your attention to the segment part.
Okay. All right, sir. Sir, I also wanted to know that did we see any redemption in the quarter or this year? Like we also saw dip in revenue up to some extent. So any redemptions?
We've not seen dip in revenue at all. Actually, the fee-based business has gone up. Yes, there are redemptions, but that is part of a strategic plan. So we had our own AIF, which we redeemed during the year because we are launching a new AIF in GIFT City.
We'll take our next question from the line of [ Mohit Barwani ], an individual investor. [Operator Instructions] We have a question from the line of [ Kunal Shah ], an individual investor.
Am I audible?
Yes, please go ahead.
My question is regarding the agency fee received by the stand-alone financials. How do you see the growth trajectory? And with that, how else would you see this picture.
So yes, I mean, that's an interesting question. Firstly, we were called Abans Holdings Limited before, I mean, when we did our annual numbers last year. Now we are called Abans Financial Services Limited because we are not just holdco at stand-alone level, and we are an investment manager which manages funds both onshore and in GIFT City. So from the perspective of investment management or asset management fee, this year we've delivered, I think, a top line of approximately INR 30 crores for Abans Financial Services. And this was our first year of completing as an investment manager. So we keep launching new products and new funds in different jurisdictions. And we -- I mean, from the perspective of growth, we would understand that this is just the beginning, and the asset management fee from various vehicles will keep rising in the future. Obviously, because the fees are based on both subscription and performance, there is no clear indicative figure that we will, I mean, for sure, accrue every quarter. But yes, the fund size that we were managing for which we booked INR 30 crores or INR 27-odd crores was approximately $30 million. And we will eventually have a $100 million fund, which we will be running in GIFT in the next 12 to 18 months. So you can assume that the fee for $100 million fund should be, if everything goes right, about 2 or 3x what we are earning currently.
We have a question from [ Mohit Barwani ], an individual investor.
Am I audible?
Yes, a little. Please go ahead.
Hello?
Mohit. Yes, I think there's a bad network at year end. Please check your network and call us again. [Operator Instructions]. As there are no further questions, I now hand the conference over to management for closing comments. Over to you, sir.
Yes. Thank you all for participating in this call. I thank my team for doing this on short notice and the guys at Valorem. I hope we were able to answer a few questions satisfactorily. And if you have any further questions that you would like to know about our company, please reach out to our IR team at Valorem. Thank you.
Thank you. On behalf of Valorem Advisors, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.
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