Gretex Corporate Services: Q2 FY26 Performance and Future Outlook

Gretex Corporate Services Limited, a prominent player in India's capital markets, has reported a robust financial performance for the second quarter of fiscal year 2026 (Q2 FY26). The company, which recently migrated to the Main Board in September 2025, showcased significant sequential growth, reflecting the strength of its integrated financial ecosystem encompassing merchant banking, broking, and wealth services. This quarter's results underscore Gretex's strategic positioning to capitalize on India's expanding capital market opportunities.

The company's total income for Q2 FY26 stood at INR 67.4 crore, marking an impressive 197% increase from INR 22.7 crore in Q1 FY26. This substantial growth was primarily fueled by a surge in IPO mandates and an expansion in market-making operations. Profitability metrics also saw a dramatic improvement, with EBITDA soaring over eight times to INR 19.6 crore from INR 2.4 crore in the previous quarter. Consequently, the EBITDA margin expanded significantly to 29% from 10.6%. Profit After Tax (PAT) mirrored this upward trend, growing over 13 times to INR 12.9 crore from INR 1 crore in Q1 FY26, with the PAT margin improving to 19.2% from 4.2%. During the quarter, Gretex successfully completed 5 IPOs, 1 delisting, 1 open offer, and secured 7 mandates in valuation and advisory services.

Financial Snapshot: Q2 FY26 vs. Q1 FY26 (Consolidated)

Segmental Performance and Strategic Focus

The revenue breakdown highlights the significant contribution of the Market Making & Broking Business, which accounted for INR 66.1 crore (83.04%) of the total income in Q2 FY26. The Merchant Banking segment contributed INR 13.5 crore (16.96%). This balanced mix, with a dominant broking arm, allows Gretex to maintain steady and recurring revenue streams while leveraging its advisory expertise for capital market solutions. The company's deep regulatory expertise and strong execution track record have been instrumental in fostering lasting relationships with entrepreneurs and investors.

Gretex's strategic outlook is focused on expanding its product offerings and strengthening its market presence. The company plans to refile its Category-3 AIF soon and launch Portfolio Management Services next year, aiming to enhance its wealth management capabilities. A significant upcoming event is the planned listing of its broking subsidiary, Gretex Share Broking Limited (GSBL), on the Main Board. This move is expected to enhance the company's visibility, credibility, and unlock value for shareholders, while also providing a stronger platform for expanding its market-making and broking operations.

Pipeline and Market Opportunities

Gretex maintains a robust and diversified mandate pipeline, providing strong visibility for sustained growth. Currently, the company has 21 IPO mandates under execution, comprising 16 SME IPOs on NSE Emerge/BSE SME Platform and 5 Mainboard IPOs. Additionally, GSBL is actively engaged in 19 market-making mandates, including 16 for SME-listed companies and 3 for institutional clients. Management anticipates at least 10-12 SME IPOs and 2-3 Mainboard IPOs to be listed by the current financial year. The company aims to facilitate fundraising of INR 1,000-1,100 crore in the current financial year, with a projected revenue contribution of 4-5% from these activities. Looking further ahead, Gretex targets to facilitate fundraising of approximately INR 20,000 crore over the next three years through private equity placements and IPOs.

Addressing Challenges and Future Outlook

During the earnings call, management transparently addressed the volatility in profit margins, explaining that the business model, heavily reliant on listing activities, involves fixed costs that can lead to fluctuations in margins quarter-on-quarter. They also clarified a negative other income of INR 12.2 crore in Q2 FY26, attributing it to a decrease in the value of invested stock in the broking account. Furthermore, past regulatory action from SEBI, which resulted in a 21-day barring from taking new merchant banking mandates, was discussed. Management clarified that these were primarily administrative errors and that all justifications were provided to the regulators, indicating a resolved issue rather than an ongoing concern.

Gretex Corporate Services Limited's Q2 FY26 performance demonstrates its ability to leverage a strong market environment and its integrated financial ecosystem. With a clear strategic roadmap, a healthy pipeline, and a commitment to expanding its offerings, the company is well-positioned for continued growth in India's evolving capital markets. The focus on disciplined execution and sustainable value creation for all stakeholders remains central to Gretex's forward journey.