SMCGLOBAL - SMC Global Securities Limited Share Price

SMC Global Securities Limited's management provided a mixed outlook during the Q4 FY26 earnings conference call. They noted that FY26 experienced a transition within the financial landscape, primarily driven by regulatory changes and market conditions. The company highlighted a strategic shift towards cash, delivery, and advisory-led businesses, viewing these developments as beneficial for the industry in the long term.

For Q4 FY26, consolidated operational income reached INR 516.9 crore, marking a year-over-year growth of 22.6% and a sequential increase of 4.5%. EBITDA for the quarter was INR 89.7 crore, reflecting a 42.6% YoY rise with an EBITDA margin of 17.4%, an increase of 250 basis points. The net profit after tax (PAT) stood at INR 21.5 crore, significantly higher than the INR 4.1 crore recorded in Q4 FY25.

For the entire fiscal year (FY26), the company reported consolidated operational income of INR 1,876.9 crore (5.7% increase), EBITDA of INR 376.4 crore (20.1% margin), and PAT of INR 103.2 crore. However, the management acknowledged margin compression primarily attributed to rising finance costs of INR 221.3 crore and a cautious financing strategy.

Key forward-looking points included:

1. Expected growth in the financing business of approximately 15% to 20% in AUM for FY27 as macroeconomic conditions stabilize.
2. Insurance broking revenue anticipated to grow by 15% over the next year, buoyed by the reinsurance segment's expansion.
3. The continued focus on securing and diversifying the lending portfolio, with secured AUM constituting around 76.71% as of March 2026.
4. An active effort to deepen cross-selling opportunities between the broking and insurance segments, leveraging a large client base.

Overall, while facing challenges, SMC Global is optimistic about return-to-growth strategies within its diversified business model and favorable market conditions.

Here are the major questions from the Q&A section of the earnings call transcript, followed by detailed answers:

Question: Can you give a break-up of our cash, commodity, and option segments in broking? Have you seen a spike in our commodity segment for the quarter or whole FY26?

Answer: The equity cash market comprises about 50% of our brokerage share, futures and options are around 40%, and commodities make up the remaining 10%. This is an increase from 4-5% last year to 10% now, showing promising growth potential in the commodity business. We anticipate this trend to continue as the global commodity market expands and regulatory support aids in retail participation.

Question: What is your focus regarding disbursements in the NBFC? How do you expect secured loan growth in the coming year?

Answer: Our disbursement approach has shifted to prioritize secured products like micro loans and gold loans, while reducing exposure to larger-ticket unsecured loans. We aim for AUM growth in focused segments, expecting an increase of about 15-20% over the next year as we stabilize our lending strategy.

Question: What initiatives are underway for insurance cross-sell and what opportunities exist for policy expansion over the medium term?

Answer: We are leveraging our existing client base for cross-selling insurance products and expanding in the reinsurance segment. The focus is on integrating offerings that utilize our corporate client networks, which we believe will enhance revenue opportunities significantly in the coming years.

Question: Could you provide an update on Stoxkart's FY26 performance regarding active clients and revenue?

Answer: Stoxkart successfully added 100,000 clients in FY26, ranking fourth in active client contributions to NSE. Revenue grew 150%, indicating strong market engagement, and we anticipate this momentum to continue, contributing significantly to overall growth.

Question: How do you see your NBFC performing in the context of RBI restrictions on leverage for proprietary trading?

Answer: We have ensured that our proprietary trading activities are sustainable despite the RBI's restrictions. Our approach involves using surplus funds for arbitrage in a manner that minimizes risk, allowing us to maintain our trading efficiency with negligible expected impact on profitability.

These answers summarize the company's outlook and strategies while including the relevant financial metrics and growth expectations discussed in the call.