Motilal Oswal Financial Services Limited (NSE: MOFSL) delivered a record-breaking performance in the third quarter of FY26, as the firm’s strategic shift toward Annual Recurring Revenue (ARR) drove operating profits to an all-time high of ₹611 crore. A surge in retail participation via SIPs and explosive growth in private equity and wealth management propelled total net profit to ₹721 crore. On the back of these results, the company rewarded shareholders with an interim dividend of ₹6 per share.
Market Capitalization:
₹45,145 crore.
Valuation:
The company reported an annualized Operating Return on Equity (RoE) of 26% for the nine months ended December 2025.
Credit Rating:
ICRA recently upgraded MOFSL to “AA+ Stable,” making it the first non-bank capital market player to achieve this rating.
Profit Drivers
Operating profit after tax increased 16% year-on-year to ₹611 crore, led by the Asset Management and Private Wealth Management segments, supported by strong systematic investment plan inflows and steady contributions from the treasury portfolio.
The quarter’s performance was driven by a higher share of annual recurring revenue, which accounted for 65% of the total revenue mix, compared with 54% in the same period last year. The shift toward fee-based income was most pronounced in the asset management business, where profit after tax rose 65% year-on-year. The treasury investment book expanded 16% to ₹9,562 crore during the period and has generated an internal rate of return of 18.5% since inception.
Financial Performance
Operating PAT: Reported at ₹611 crore for Q3 FY26, a 16% increase year-over-year and 10% sequentially.
Total Revenue: Net revenue reached ₹1,497 crore, up 11% compared to Q3 FY25.
Margins: Profit Before Tax (PBT) margin improved to 54% from 52% in the previous year’s quarter.
Segment Performance:
Asset Management: PAT grew 65% YoY to ₹227 crore; Mutual Fund AUM rose 40%.
Private Wealth: AUM reached ₹1.96 lakh crore, up 31% YoY.
Capital Markets: PAT increased 15% YoY to ₹70 crore.
Housing Finance: PAT grew 12% YoY to ₹42 crore with AUM rising 24% to ₹5,379 crore.
Business Outlook & Strategy
Management continues to focus on a “Twin-Engine” model, utilizing a large treasury book to provide stability and capital for its operating businesses. The strategy emphasizes growing the ARR-based revenue stream, which has increased from 58% in FY21 to 74% in 9M FY26. The company recently expanded its product suite by launching a maiden Private Credit Fund in January 2026 with a target size of ₹3,000 crore.
Sector and Macro Context
The results reflect the ongoing “financialization” of Indian household savings. MOFSL’s growth in Systematic Investment Plan (SIP) inflows, which surged 55% YoY to ₹4,515 crore; aligns with broader industry trends of increasing retail participation in equity markets. The company maintains a strong capital position with a net worth of ₹13,632 crore as of December 2025.