Anand Rathi Wealth delivers growth, but valuations leave no room for error

Anand Rathi Wealth reported a 74% year-on-year jump in Q1FY27 profit after tax to around 163 crore, aided by mark-to-market gains, though EBITDA margin fell to 34% from 47% due to a one-time ESOP charge. Client stickiness remained robust with attrition at just 0.09% of AUM, and the company retained about 90% of assets linked to departed relationship managers. Motilal Oswal downgraded the stock to Sell with a one-year target of 1,700 rupees against the current price of around 2,080, citing stretched valuations and potential margin pressure from TER compression.