Choice International Q4 FY26: Growth with operating leverage, and a bigger distribution push

Choice International Limited closed Q4 FY26 with steady momentum across its diversified financial services platform. Consolidated total income for the quarter was INR 313.85 crore, up 23% year on year. EBITDA rose to INR 122.64 crore with a 39.08% margin, and profit after tax (PAT) grew 27% to INR 67.84 crore.

For FY26, the company reported consolidated total income of INR 1,144.50 crore, up 24.18% over FY25. PAT expanded faster than revenue, rising 46.21% to INR 237.89 crore. Management attributed the gap between revenue and profit growth to operating leverage, driven by a greater role for technology and scaling without a commensurate increase in fixed costs.

What drove Q4: segment mix is still anchored in broking and advisory

Management disclosed a quarter-level revenue split that highlights how Choice’s business model is structured today. In Q4 FY26, the broking and distribution business reported revenue of INR 179 crore and was described as contributing 59% to total revenue. The advisory segment delivered INR 91 crore (28% contribution), while the NBFC reported INR 43 crore (13% contribution).

Broking continues to scale through a combination of physical reach and digital execution. The company reported 12.63 lakh demat accounts as of March 31, 2026, and noted that 70% of revenue comes through online trade execution on its platforms.

Advisory remains the second large pillar. The presentation reported an order book of INR 698 crore in Q4 FY26, lower than INR 748 crore in Q3 FY26. On the call, management said Q4 was execution-heavy and that the pipeline remains strong, with bids submitted in excess of INR 400 crore.

NBFC growth remains positioned around secured lending. The loan book stood at INR 800 crore with GNPA at 2.74% and NNPA at 1.86% as of March 31, 2026. Net interest margin was reported at 11.22% for Q4 FY26.

Distribution strategy: physical reach plus digital execution

A key theme in the presentation is Choice’s attempt to widen its distribution footprint while keeping execution tech-led. The company highlighted a large on-ground network, including 217 branch offices and 67K plus Choice Business Associates. It also stated an explicit plan to establish presence in every district over the next three years.

This distribution build-out is aligned with the company’s stated observation that client preferences are shifting towards service-driven brokers. The company is combining that physical presence with a largely digital execution layer, with management stating that roughly 70% of revenue is generated via trades placed through online channels.

On the technology side, the presentation described an infrastructure upgrade for its retail investing platform. It cited the migration of legacy OMS and RMS to a new-age C++ architecture serving 85% of users across North, West and East India, along with rebuilt core APIs aimed at ultra-low latency. The stated intent is to scale active traders with stable performance during peak market loads.

Wealth and AMC: equity focus, and a new distribution lever through IPPB

The wealth distribution data in the presentation showed a decline in overall wealth products AUM, with Q4 FY26 AUM at INR 4,267.7 crore versus INR 5,577.4 crore in Q4 FY25. In the Q&A, management clarified that the decline was driven by redemptions in debt mutual funds due to market sentiment, while equity mutual fund AUM grew 35% year on year to INR 2,311.1 crore.

A strategic development for the wealth business is the mandate from India Post Payments Bank. Choice Wealth Private Limited has been awarded a contract to deploy a digital investment platform for IPPB customers, including mutual fund aggregator services and robo-advisory services across mobile, web, and mATM-compatible devices. Management said the partnership should keep customer acquisition cost negligible because it is aimed at IPPB’s existing customer base.

The call also provided operational color on how the partnership could scale. Management expects the integration to go live in the quarter and stated that revenues should start reflecting from 1 July, with profitability starting to come in thereafter. On expected investor behavior, management indicated a realistic SIP ticket size expectation of around INR 2,000 to INR 2,500 per customer per month for the IPPB customer base.

In asset management, the presentation outlined the company’s move from passive to active over time. It noted that SEBI granted an AMC license on August 1, 2025. In Q3 FY26, the company launched a Gold ETF and reported more than 28,000 folios with INR 57 crore mobilized. In Q4 FY26, it launched index funds, including a Nifty 50 Index Fund and Nifty Next 50 Index Fund, with INR 30 crore mobilized. Management stated a target to reach INR 1,000 crore AUM by the close of FY27.

Risks and watchpoints highlighted implicitly in the discussion

Not everything in the quarter was uniformly positive. The decline in advisory order book quarter on quarter is a visible datapoint, even though management attributed it to higher execution in Q4 and expects order inflows to rebuild. Similarly, wealth AUM declined at the aggregate level, even as equity mutual fund AUM grew sharply.

In the NBFC, management acknowledged that NPA levels rose during the year, linked to broader stress seen in the microfinance environment, though it indicated that conditions appear to be normalizing and that NPA metrics improved in Q4.

The insurance business showed a shift in mix towards retail, with management acknowledging a decline in corporate premium versus the prior year due to high base government contracts. Management stated an intent to maintain a 50-50 corporate and retail mix over time.

Takeaways

Choice International ended FY26 with strong headline growth and a clear message on operating leverage. The company is positioning its model around a relatively stable mix of broking and distribution, advisory, and secured-focused NBFC lending, while investing in platform upgrades and distribution reach.

The next set of milestones to track are tangible. Management expects IPPB-linked revenues to start from 1 July, it has articulated a FY27 AUM target for the AMC business, and it expects a return to order book growth in advisory given a stated pipeline of bids. If these execution points land on time, the company’s multi-vertical strategy could look more coherent and scalable over FY27.