JMFINANCIL - JM Financial Limited Share Price

Management's outlook for JM Financial Limited remains optimistic, with key projections highlighting sustained growth across various segments. For the nine months ended December 2025, the consolidated profit after tax (PAT) reached INR 1,037 crores, reflecting a 69% year-on-year increase, while Q3 FY26 PAT stood at INR 313 crores, a 50% increase year-on-year.

Highlights from the management include:

1. The consolidated net worth, excluding minority interest, is currently INR 10,418 crores, translating to a book value per share of approximately INR 109.

2. Fees and commission income saw a significant year-on-year increase of 32% to INR 306 crores, indicating a healthy environment for deal-making, with a strong transaction pipeline.

3. The IPO pipeline amounts to over INR 120,000 crores, which management anticipates executing over the next 12 to 18 months.

4. Wealth and asset management continue to see growth, with recurring assets under management (AUM) reaching INR 33,100 crores, marking a 33% year-on-year increase.

5. Management expects continued investment in talent and infrastructure, particularly in wealth and asset management, which has seen increased expenses but is vital for future growth. They aim to grow the affordable housing business by over 25% annually for the next three years, supported by a customer base surpassing 30,000 and AUM of approximately INR 3,200 crores.

6. In the private credit segment, management forecasts a 20% annual growth for the loan book over the next three years, accompanied by strong syndication revenues anticipated from a booming credit market.

7. Considerable investments are planned for 2026 to boost the size and reach of wealth and asset management businesses, along with successful launches of newly approved alternative funds.

Overall, management communicated a solid growth trajectory, balanced by strategic investment to enhance productivity and operational reach.

Major Questions and Answers from the Q&A Section:

Question 1: "Vishal, first question is that, see, the third quarter, markets were weak and we had a lot of new opex coming in on wealth and even the capital markets division. Would it be safe to say that we have probably reached a trough in terms of profitability in these two divisions?"

Answer: Yes, Digant. Both divisions have been impacted by market volatility but are showing strong underlying momentum. The Capital Markets and Corporate Advisory are deal-related, and we see a healthy pipeline. Wealth Management is a long-term investment, and while we have volatility in transactional income, we expect increasing productivity from recruitment efforts as we transition into 2026.

Question 2: "Regarding the Private Credit division. The income line item has actually started moving up. When does this loan book start moving up?"

Answer: We're targeting a 20% growth in our loan book over the next three years. We're focusing on syndication and quality underwriting, and while the loan book might vary each quarter, the overall pipeline is strengthening, indicating promising growth in the next few years.

Question 3: "We've seen stellar growth in the Affordable Housing segment. Can this momentum be maintained?"

Answer: Yes, Digant. We expect this calibrated growth of around 23% to continue, particularly in our stronghold areas like Gujarat and Maharashtra. We've also seen a solid uptick in collection efficiency and a robust performance from our NPA management, ensuring sustainable growth.

Question 4: "On wealth management, we've doubled the RMs. What is our aspiration for AUM per RM going forward in the next 2, 3 years?"

Answer: The aim is to see AUM per RM grow upwards of 25% annually in the next 2-3 years. We've increased our RMs to expand our client base and push for greater recurring revenues, ensuring sustained growth despite recent fluctuations.

Question 5: "What's stopping JM from executing more IPOs? Is it the market conditions or SEBI approvals?"

Answer: It's purely market conditions. While SEBI is approving IPOs effectively, current market volatility has made execution challenging. As stability returns, we anticipate a resurgence in IPO activity.

Question 6: "If we strip out the interest on income tax refunds, our core operating revenue appears to have contracted. Can you explain the reason for this decline?"

Answer: The decline is largely due to a reduced loan book, as we've strategically downsized to focus on quality. Even when accounting for this, our operating profit after tax shows a 17% year-over-year increase, indicating strong fundamentals.

Question 7: "We have seen a significant improvement in gross NPA ratios in Housing Finance. What led to such a drastic fall?"

Answer: We sold NPAs worth INR57 crores without impacting the P&L, reflecting our strong provisions to cover expected losses. This sale allowed our collection teams to focus on recovering other accounts, achieving better overall asset quality.

Question 8: "Given the rise in job losses linked to AI, how do you see the impact on real estate markets, especially in IT hubs?"

Answer: While job losses in IT may affect certain segments, strong recoveries in other sectors, like infrastructure and defense, may balance this out. We're cautious in our lending practices, maintaining focus on high-quality developers in major cities like Mumbai and Bangalore.

Question 9: "What does the current capital allocation look like for your INR24,000 crores balance sheet?"

Answer: A significant portion is committed to Private Markets. We're looking for healthy returns in Home Loans, and although Asset Management will continue to need investment, we expect to drive a higher ROE as we scale. We're also leveraging recent capital purchases to optimize our future growth strategies.

This summary encapsulates significant inquiries and detailed responses from the earnings call, providing a clear snapshot of JM Financial's current standing and strategic outlook.