Choice International Ltd (CHOICEIN) Q1 FY27 Earnings Call: NH Investment Infuses Rs. 900 Cr, IPPB Rollout Set for September

Choice International Ltd held its Q1 FY27 earnings call on August 10, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Revenue Growth Led by Broking & Advisory; Margins Hold Firm

• Rs.319 crore consolidated revenue — up 34% YoY and 1.6% QoQ in Q1 FY 2026-2027, with broking & distribution contributing Rs.197 crore, advisory Rs.91 crore, and NBFC lending Rs.45 crore.
• EBITDA of Rs.114 crore — margin of 35.75% reflecting cost discipline; net profit (PAT) of Rs.61 crore (19% margin) grew 26.37% YoY.
• Stock broking AUM of Rs.62,226 crore — up 30% YoY; wealth AUM at Rs.4,961 crore; demat accounts reached 12.94 lakh (up 13% YoY).
• Insurance premium collections of Rs.80 crore — up 5% YoY, while policy volume surged 73% YoY to 67,828, driven by expanding partner network and digital channels.
• NBFC loan book of Rs.836 crore — contributed 13% of total revenue; NIM steady at 11.10%, with Gross NPA of 3.78% and Net NPA of 2.74% as of June 30, 2026.
• Sequential EBITDA and PAT declined in Q1 FY 2026-2027 — management noted the dip but confirmed both metrics remained higher year-on-year.

Consulting Backlog Provides 2–3 Year Visibility; IB Pipeline at Rs.6,766 Crore

• Consulting order book of Rs.777 crore — contributing 28% of total revenue, providing 2–3 year visibility; subsidiaries secured Rs.191 crore in government mandates for e-governance, infrastructure, and financial consulting.
• Investment banking pipeline of Rs.6,766 crore — 1 IPO completed in Q1 FY 2026-2027, with 30 mandates under execution.
• Merchant banking fundraising mandates of Rs.6,600 crore — expected to complete over the next 1–1.5 years (through FY 2027-2028), with a hybrid fee structure generating ongoing revenues.
• A couple of IPOs ready for launch — subject to suitable market sentiment; the company launched its first Category 2 AIF in Q1 FY 2026-2027, a pre-IPO focused fund sponsored by Choice International.
• Government advisory business maintaining ~20% net margin — management expects to sustain similar margin levels as the order book grows; the project mix is expected to shift from heavy infrastructure toward governance framework, IT consulting, and project management assignments.

NH Investment Rs.900 Crore Infusion in Q2; IPPB Rollout Set for September

• Rs.900 crore capital infusion from NH Investment — expected to be received in Q2 FY 2026-2027; management stated that real growth impact from deploying this capital will be visible from Q3 FY 2026-2027 onwards.
• Strategic partnership with NH Securities (NHIS) — Group CEO Arun Poddar described the transaction as "primarily strategic" with capital being the "smallest part"; key synergies include integrating NHIS's institutional client base in Southeast Asian and US markets with Choice's Indian operations for cross-border business needs.
• Additional business integration expected in investment banking — across multiple jurisdictions over the coming years; the partnership aims to expand Choice into institutional broking and global markets while providing Indian clients global market access.
• Incremental capital deployment toward MTF and settlement funds — in line with regulatory guidelines, expected to drive additional profitability through increased interest income and brokerage from higher client trading activity; no specific ROCE targets were disclosed.
• IPPB integration nearing completion — integration with India Post Payments Bank is on track for end of August, with customer onboarding expected to begin from 1st September; revenue impact from this exclusive partnership remains undefined until initial volumes are observed.

Broking Dominates at 60% of Revenue; Advisory Targeted to Reach 40% Over Two Years

• Revenue mix as of Q1 FY 2026-2027 — 60% broking, 30% advisory, and 10–12% from NBFC; management targets a future mix of 50% broking, 40% advisory, and 10% NBFC over the next two fiscal years (FY 2027-2028 and FY 2028-2029).
• Broking & distribution PBT of Rs.48 crore — on revenue of Rs.197 crore; demat client base reached 12.94 lakh; the NH partnership is expected to drive "multifold revenue and profit growth" in the broking segment according to the CEO.
• Advisory business revenue of Rs.91 crore — supported by a steady mandate pipeline; the shift toward advisory is driven by faster growth relative to broking, while NBFC share is expected to remain stable.
• NBFC segment described as in a "gestation period" — management expects higher returns from it within one year (by about FY 2027-2028), prioritizing diversification over allocating all capital to the higher-ROE broking business.
• Solar financing portfolio target of Rs.150 crore by end of FY 2026-2027 — currently very small relative to total NBFC book; weighted ROI is 17–18%, with a plan to reduce it to around 15% through the pipeline; management aims to maintain an ~15% ROI for end customers.

NPL Improvement Driven by In-House Recoveries; Shift to Fully Secured Lending

• NPL improvement in Q1 FY 2026-2027 — driven entirely by recoveries from the in-house collections team, following a structured handover from the sales team; Gross NPA of 3.78% and Net NPA of 2.74%.
• 20–30% AUM growth expected in NBFC segment — in a stable interest rate environment (period unspecified), with a continued focus on secured lending; the incremental loan book in Q1 FY 2026-2027 will consist entirely of secured loans.
• Credit quality managed through proprietary assessment engine — combined with mandatory human verification (ground visit by credit team + central team reconciliation) before final sanction.
• Solar financing is a secured product — with solar equipment as collateral; the portfolio target of Rs.150 crore by end of FY 2026-2027 remains on track; management plans to publish the solar AUM in future public disclosures.

50% CAGR Reaffirmed; Branch Expansion to 300–350 by March 2027

• 50% CAGR growth target reiterated — management expects the FY 2025-2026 PAT base of ~Rs.237 crore to grow "tremendously" in FY 2026-2027, with another 50% growth expected in FY 2027-2028.
• Branch target of 300–350 by March 2027 — from the current count of ~210–220 as of Q1 FY 2026-2027, implying ~100 branch additions in H2 FY 2026-2027; only 10 branches were opened in the first 6 months of calendar 2026, but management cited priority on finalizing teams before opening dedicated branches.
• Long-term branch target of 800 over 3–4 years — by approximately FY 2030-2031, reiterating the long-term growth plan.
• AMC business in setup phase for FY 2026-2027 — focused on passive products, with active schemes targeted for launch by end of FY 2026-2027; proper growth phase expected from FY 2027-2028; the AMC is planned to reach EBITDA break-even over the next 2–3 years (long-horizon target, specific FY not given), driven by AUM growth.
• Mutual fund distribution business guided for 30–35% YoY growth — in overall AUM for FY 2026-2027.
• Management cited seasonality for flat sequential performance — over the last three quarters (Q3–Q4 FY 2025-2026, Q1 FY 2026-2027), but affirmed that growth will "tremendously" improve from Q3 FY 2026-2027 due to the capital infusion and IPPB rollout.