360 ONE WAM LIMITED analyst Q&A

- Thank you, Karan. In case you wish to ask a question, request you to tap on the ‘Raise hand’ icon. First in line we have Mohit Mangal. Kindly unmute yourself and ask your question. - Mr. Mohit Mangal – Participant: - Yeah, congratulations on a good set of numbers. So, first on this acquisition, I mean, if I look at the last 2 to 3 years, we have acquired ET Money, Mumbai Angels, and now B&K. So, just wanted to know, I mean, I understand that they supplement the wealth management business but do your focus is building on a holistic financial services company and maybe it would be no surprise that you would continue with such big acquisitions?

- As I said earlier, we have to complete the platform of offerings to the clients and if I were to look back over the last 24-36 months, this was a missing link especially both on the research and the capital market side. If I were to look at our client offerings, we were potentially missing that gap. We were leaving a gap open for our competitors to get in. And in a lot of cases, some of our competitors were able to use that to enter into the relationship. At the same point of time, we have phenomenal promoter connects and, were not being able to take advantage of those connects and ensure that we're able to build a deeper relationship with the client. Well, one of the best points to build a relationship with the client is obviously at the point of him raising some capital. So, that's s omething which we were missing - From a focus perspective, it's not something, just given the specialization on each business, which we can build absolutely ground up from day zero. And that would consume a lot of our own management time and bandwidth. So, for any of these acquisitions to work, it's very important to find the right team on the ground. Not only the right team, but also the right product in terms of research - And thirdly and most importantly, both in terms of cultural alignment, retention and the ability to work together for the long term have to come through. And only if these three things can fall in place, it can have a multiplier effect. While acquisitions can or cannot work out, but I'm quite confident on this largely because of the amount of time we've been able to spend with each other and understand each other's business. While 360 ONE's remained super sharp, laser focused on the wealth and the asset management side, I can say the same thing for B&K on the equity side. And, therefore, as long as there's a cultural fit, the sharp focus and the right time for management allocation between the three businesses will continue. - Mr. Mohit Mangal – Participant: - Understood. So, do you have anything more in the pipeline currently?

- No, not really. - Mr. Mohit Mangal – Participant: - Okay. Now coming to business, three major questions. So, first is on Other Income. So, markets were down but if I look at the number, that was up both sequentially as well as annually. So, what could be the reason for that?

- Other Income on the listed exposures is only Rs 260-280 Crs. Our large exposure is to fixed income and unlisted equity. So, a larger part of the uptick typically has happened on this unlisted equity side and we have a couple of investments in yield instruments which got converted to listed InvITs and listed REITs. So, if you look at our alternate exposure, it was around about Rs 1,800 Crs, which forms the bulk of our Other Income. Less than 14%-15% is in listed equity, the remaining 80%-85% is in yield assets or late stage private equity. - Mr. Mohit Mangal – Participant: - Understood. In terms of net flows, I think we were good at around Rs 22,000-23,000 Crs and maybe the guidance for Rs 25,000-30,000 Crs for the entire year would be met. So, do you have any internal targets in terms of FY26?

- Honestly, Mohit, we could have done slightly better on net flows for the year. While our target was 25-30k, we should have been closer to 30-35k just given the kind of year it was. But, we would want to keep that track of being able to have around about 10%- 12% of AUM added through net flows. If we were to start the next year, including the mark-to-market and stuff like that, Rs 25,000-30,000 Crs would need to equate to about the Rs 35,000-40,000 Crs number to be able to kind of match the 10% because to get to the 20%-25% AUM growth, we need to do the 10%-12% AUM growth on the new base. And, obviously, 8%-10% can happen through mark-to-market over a period of time. The only way to get to the 20%-23% AUM growth is to ensure we get a 10% AUM growth on the opening base. - Mr. Mohit Mangal – Participant: - Right, makes sense. Lastly, in terms of attrition, RM or client, over the last 9 months did you see anything unusual or was it business as usual?

- No, we've seen a little bit of an incremental attrition on the North side of our business on the wealth management side. So, a couple of leadership changes, which we had to make more driven out of our own business priorities. And that resulted in 6-7 wealth managers moving out of our Delhi office. So, that's the only place where we’ve see an incremental attrition, but well under control. We have 130-140 senior bankers across the country and in that sense, we have 4,500-5,000 large families above Rs 10 Crs, so in terms of the ability and capacity to serve those clients is well established. So, from a business perspective, Delhi itself might see a 3%-4% or maybe 5% maximum reduction in revenue, but at the same point of time, we've attracted a whole host of people from other private banking platforms. And as we've kind of ended up adding new senior folks in our North market over the last 45 days, by April, May, June, we will be old team strength plus 10%-15%. Overall, North will end up, from a revenue pool of about Rs 160 Crs, at 40%-50% higher over the next 2-2.5 years. So, you will see a temporary blip of 5%-6%, there but nothing beyond that. And from a client attrition perspective, we haven't seen any large trend yet. The clients are pretty much still intact. Maybe with 3 or 4 families, we will see attrition but largely client-wise, it's pretty much there. For every team which moves out, it's a long process as they onboard. Outside of that, we haven't really seen any crazy attrition. But please, also remember that for every relationship, we have at least 3 teams interacting with the client. We've got investment advisory team, we've got the product team and we've got the relationship team. So, as such, it's a fairly comprehensive and tight setup. Even today, we've got a couple of really senior folks from Mumbai who relocated to Delhi and we've got the entire residual RM team plus the new relationship team there. So, in that sense that's the only thing. Outside of that, across all businesses it's just business as usual. That's the only geography where we’ve seen some bit of attrition. - Mr. Mohit Mangal – Participant: - Understood. And, lastly, in terms of RM hiring, so what are the plans for FY26?

- I think, conservative. I don't see us hiring like crazy. I don't think the business is anymore about just adding RMs. It's about adding the right set of RMs. And the industry on the wealth management side, it will consolidate a lot over the next 12-18 months. And there has been a little bit of competitive excess in the industry over the last 6-8 months and that's what set off a bit with a whole host of transaction income and selling of unlisted stocks and ideas. That obviously can't continue perpetually. So just going out and building cost models which need to be offset with that income or other income is not really going to play out over the longer term. We'll grow steadily and around about 8-10 incremental hires in North. Outside of that, we'll still continue with the same pace of adding around about 15-25 bankers. So, if you ask me, in total next year we'll add around about 20-25 bankers, which is around about 7-8 more than what we would normally do, which is largely a replacement hiring. - Mr. Mohit Mangal – Participant: - Understood. Thanks and wish you all the best.

- Thank you.

- Request you to restrict yourself to two questions. You can come back to the queue again once the questions are done. Next in line we have Prayesh Jain. Kindly unmute yourself and ask your question. - Mr. Prayesh Jain – Participant: - Hi, Karan. Can you hear me?

- Hi, Prayesh. How are you? - Mr. Prayesh Jain – Participant: - I'm good. Karan, just firstly on this acquisition. We've been talking about the ARR growth and we would be kind of sticking to the high share of ARR revenues in our business model. But as I understand, both IE, IB have a very high transactional income. In fact, they are transactional in nature completely. So, that does change or alter the way we look at 360 ONE as a whole with respect to how the ARR versus TBR will kind of move going ahead. Just on that bit, again if there is a possibility you can share us the revenue breakdown between IE, IB and the Treasury of B&K Securities.

- I fully agree with you. We're very conscious of that split but, from a change in revenue mix, I don't see too much changing just given the overall size of our ARR growth in ARR and the TBR mix. So, just to put things in context, out of our overall revenues of approximately Rs 2,500-2,600 Crs in a year, around Rs 1,600-1,700 Crs is on the ARR side, which is approximately 65%-70%. And the transactional income obviously has been exceptional last year. It's been close to around about Rs 700 Crs. But like I've said many times, I don't think that that's possible to sustain. The Rs 700 Crs in most markets would be close to Rs 450-500 Crs or Rs 125 Crs a quarter or Rs 130 Crs a quarter. This year, we have Rs 150-175 Crs of transaction income extra and I don't think it will sustain in every market. Obviously, last 9 months and the 12 months before that the markets have been on a tear. So, the brokerage revenue of B&K together with our transaction revenue more or less remains at the same amount for the next year. So, the current revenue, transaction revenue, number of Rs 700-750 Crs may potentially come down to Rs 500- 550 Crs and we are now around about Rs200-250 Crs of brokerage income from B&K next year. Whereas, obviously, the ARR income continues to grow in a fairly steady manner at 12%-18% every year. So, overall, at Rs 2,800 Crs and you add another Rs 200- 250 Crs of transaction revenue and reduce Rs 150 Crs transaction revenue and add the ARR, our transaction revenue will continue to be in that subset of around about 20%- 25%. And I think all global benchmarks, broadly speaking, there are two things we would like to follow. We'd obviously like to grow our ARR revenue significantly. The two numbers we'll want to track is we want to ensure our TBR incomes around the 20%-22% range, our Net Interest Margin also is around the 20% range and the rest of the income, which is your wealth management advisory income, your asset management fee income and the wealth management distribution income, that accounts for around about 60% of the income. So, just from a perspective in terms of quality, health of earnings and health of revenues, that's the mix we would like to see. So, about 60% coming from fees charged to the client plus the trail earned from the manufacturers. Maximum of 20% coming from Net Interest Margin and a maximum of 20% coming from TBR. So, that’s the long-term plan. There will be years where this gets a little distorted. So for example, last year, just the way the markets are, TBR has increased a bit. But generally speaking, the two numbers which we want to ensure are not more than 20% is NIM and not more than 20% is TBR. On the mix of revenues from B&K perspective, around Rs 250-260 Crs, nearly 80%is coming from institutional equities. Only approximately 4-5% is currently from investment banking and approximately 17-18% comes from mutual fund distribution. Institutional equities makes up the bulk of it, which is about 75-80% of the revenues. Obviously, that can also have a direct linkage to the market but it’s not as cyclical and binary as the investment banking mandates. That’s obviously a bit of a slow business, but they have a strong client base, both in terms of domestic mutual funds and insurance companies as well as FIIs. Lastly, the corporate mutual fund distribution business is obviously fairly unique. They would be among the top 3 players in the country and the mutual fund trail business of Rs 40-45 Crs is extremely sticky. So overall, if you look at the business, the institutional equity brokerage, I wouldn’t put it in the same cyclical bucket as much as investment banking and overall, if I look at the pool of our own revenues, it would still be around 60-65% and, they are our 20-odd percent net interest margin and 20% transaction. - Mr. Prayesh Jain - Participant: - That’s pretty helpful. Just on the core business front, how has been the customer behavior and with respect to flows and anything that you can help us understand what's happening given the sharp market corrections we have seen?

- Very difficult to call it out, but generally speaking, clients are comfortable right now and if you see our asset allocation committee notes and all the religious efforts we made over the last 6 odd months, we advised clients to have anywhere from 10 to 30% cash. We are underweight midcaps now maybe more than what we should have, maybe 9 months to 15 months. So, obviously, you can’t get these things right. But, generally speaking, our average client is having a lower weightage and lower allocation to midcaps and potentially sitting on 10 to 30% cash. Is there a frenzy to invest the 10-30% cash? the answer is no. The clients are still looking out and waiting out for the right set of opportunities. Having said that, is there a concern on the flurry of activities continuing, of becoming lower? The markets to continue to head one way and there is a fair degree of volatility over the next 30 to 45 to 60 days, you might see the level of activity come down a bit but overall, most of our clients are fairly in a comfortable position and I wouldn’t say they feel that this is yet the best time to kind of come in with that 10-30%. - Mr. Prayesh Jain - Participant: - How do you look at cost to income? With this acquisition and whether any… - Nothing different at all. The new acquisitions also working around the same cost to income in the 45-47%. There is really no change there. Broadly on Rs 240-250 Crs topline, ~Rs 105 Crs of profit after tax, give or take similar cost to income and as I said earlier, very very similar way to do business. From a cost to income perspective, really we don’t see any change at all. - Mr. Prayesh Jain - Participant: - Thank you and wish you all the best.

- Thank you.

- We will move to the next caller – Jayant Kharote. Jayant, kindly unmute and ask your question. - Mr. Jayant Kharote – Participant: - Thanks for the opportunity and congrats on the good set of numbers. Firstly on the distribution flows for this quarter, it’s around 40 odd billion. Last quarter, we had a pretty strong number here but bearing that one it seems, this is the sort of run rate we have been having to sort of move next year’s target of new money, north of Rs 30,000 Crs, this number needs to move up quite meaningfully. So what do you think is lacking and what can be done?

- This number will benefit a bit from our full HNI launch. That’s something which should spur up this number quite a bit. I feel it will come in a little bit more also on the alternate side eventually because right now it’s not showing up in the numbers because we have had nearly Rs 4500-5000 Crs of outflows on the alternates because of the redemption of the earlier funds this year. Those two things will help distribution of assets earning trail fees. Pure mutual funds from UHNIs increasing the distribution assets is extremely unlikely. Those line items are getting divided between the 1st line and the 2nd line. So, our HNIs, together with the continued focus on alternates, will lead to the right growth in that line item. - Mr. Jayant Kharote – Participant: - Great! Just again, 2nd question following up on the alternate itself, drawing into your experience, how do you think this plays out? Let’s say if this year, markets are sideways, Jan is sort of a trailer over there, how does the alternates market behave in this environment? Do you see that cash deployment first moving towards alternates or the mix doesn't change really?

- The mix won’t change. It will change within alternates, maybe private equity allocations slightly lower, yield asset allocation slightly more, operating assets slightly more, real assets slightly more. Alternates will continue to be quite interesting. You might see the launch of the small mutual fund in which case the entire long drawn strategy will come into place. In general, alternates will continue to be interesting. The broader mix between private equity, credit, yield assets and listed equity will keep changing. But there are enough ideas and enough traction for different themes. For example, we are going to launch our next fund which is largely focused on multi-asset. So it is not only focused on private equity but the 1st three transactions that we have done are kind of more on the yield side as opposed to being on the equity side. - Mr. Jayant Kharote – Participant: - Sorry, just one follow-up on this one only, alternates. The gross flow number that you mentioned, is that stable QoQ or just for the redemptions in the distribution assets in the alternate’s piece?

- I think it is. Last two quarters have been better, but I would put it in the same zip code plus minus 10% or 15%. - Mr. Jayant Kharote – Participant: - So once the redemption cycle gets over, this number should…… - Yes, this automatically should start working. We have had an exceptional redemption this year. We started off with a Rs 6,000 Crs fund in 2017-18, and we returned close to Rs 13000 Crs or slightly more 13,500 Crs of which Rs 12,200 Crs of redemption is already there and we have another Rs 1,300 Crs to go. - Mr. Jayant Kharote – Participant: - Great! Thanks and congrats once again for a great set of numbers.

- Thank you.

- Thank you. Next in line, we have Sandeep Jain. - Mr. Sandeep Jain – Participant: - Couple of questions: 1st, on this convertible warrant which we will issue to the promoter of B&K, is there any kind of timeline when it will get converted into equity or is there any timeline kind of lock in period and all?

- Just a normal warrant, 18 months at the prevailing market price. - Mr. Sandeep Jain – Participant: - At the prevailing market price, ok. 2nd, the cash payout of Rs 200 Crs which we are saying to link for achievement of financial target, it is a kind of equal every year or something like it’s a backend kind of thing? - No, it’s at the end of the 4th, 5th and 6th year. - Mr. Sandeep Jain – Participant: - End of 4th, 5th and 6th year. - This is basis of certain set of numbers achievement, so on and so forth. - Mr. Sandeep Jain – Participant: - Got it! And one question in terms of acquisition strategy. If I look at the last 1 or 2 years like in the 1st question, it has been asked, you acquired ET Money, you acquired this, as a whole, where we are going? If I look at the B&K, 85-90% of the revenue comes from largely in terms of the broking income and in terms of, we are saying the synergy in terms of acquire the corporate account or kind of treasuries and all these things. It doesn't match kind of thing when we are saying that?

- If you look at all the large private banks have 3 lines of businesses – there is the capital market business, there is the asset management business and wealth management. These are the 3 businesses and all the acquisitions and everything we have done is either within this business or it’s expanded the segment horizontally. So when you talk about ET Money or you talk about any of the acquisitions there, it’s essentially a horizontal expansion of the segment. We could be moving up or down the segment within the same offering. Similarly, on the asset management side, obviously what alternates and mutual funds which are 2 different parts of the offering and 3rd, you got the capital market space. Within the capital market space, you have got different segments to operate again. It happens to be institutions as well as HNIs and family offices. HNI and family offices, in a certain small way, already existed in the wealth management business. The institution piece didn’t exist in our business and together with B&K, we will see how to build out the investment banking piece in the best possible way. And if you see globally also, if you see the bigger, for example, just look at UBS, you look at Goldman, you look at all of these private banks, all of them would have these 3 businesses. They would have wealth, asset as well as the capital market business. - Mr. Sandeep Jain – Participant: - Ok. So the point which I am trying to make here is, when we have kind of demerged from the erstwhile group, it was supposed to be a purely wealth management game. Karan, don’t get me wrong but what I am trying to understand here is that, in terms of getting the funnel, do we need this kind of acquisition more in terms of getting the client, HNI and all these things because at that point of time, maybe my perception was that it will be a purely wealth management business and all these things. So funnel is getting… - I don’t look at it that way whether we want to be a pure wealth management. The 1st question to answer is what does the client need and how do we complete the client’s platform actually? So, the 1st question to ask is, am I able to serve the client on a 360 basis and where are we missing out from a client platform perspective, that’s the most important perspective. And today to serve my clients, specially the client who is $500 million plus in networth, not necessary in terms of financial assets, but even in business assets, it is an important part of the offering. And for us, rest of the things, whether we are a pure play, everything else has to follow. The 1st thing is obviously the requirement of the client and today if I look at the client proposition and what we need to deliver to the client, then that’s a missing piece that we would like to add. - Mr. Sandeep Jain – Participant: - Ok thanks.

- Thanks.

- Thank you. Next in line, we have Dipanjan Ghosh. Dipanjan, kindly unmute and ask your question. - Mr. Dipanjan Ghosh – Participant: - Hi Karan!

- Hi Dipanjan! - Mr. Dipanjan Ghosh – Participant: - Sir, just a few questions - 1st, if you can give some color on the variable payouts, excluding the acquisition, how do you think it’s shaping up for the next year. Of course, you acquired a few teams last year so some of them would have scaled up. Our TBR was quite strong this year. As you said, except B&K, this run rate may not be sustainable. So just wanted to get some color on how the entire score card based model is working out and how do you see the overall variable payouts and if you can just quantify, can we build in an ESOP expenses, maybe a year out from now? Just one more question which has got asked multiple times in the call. In terms of the client sentiment. What we see is the number of high quality client additions during the quarter was tad lower than the run rate we have been seeing for the last 2 quarters. I think 60 clients were added in this quarter versus little bit more maybe in the last 1 or 2 quarters. So incrementally the markets were to remain the way they are. But on the other side, you have been expanding geographically, adding new teams, the existing schemes scaling out, the HNI proposition kind of rolling forward from April onwards. How do you see your new client addition run rate shaping up in the next year?

- No, both are fair questions. I will start with the first question - from a variable and bonus payout perspective, the current year has had a slightly larger tinge of variable because we have changed the method of payout but largely speaking, approximately our current design plan for the next financial year would be ~Rs 150 Crs of fixed cost per quarter, which would translate to about Rs 600 Crs a year. You would see 40-50% of that expresses itself through variable bonuses. Also, why I am saying 40-50%, it’s a bit of the function of the way the markets are. Obviously, if the things are absolutely not in the right direction, then the number can come upto 30% but typically speaking, more often than not in the region of 40-50% and then you got the soft cost of ~Rs 100 Crs across the P&L. If you see the employee cost, it’s in the region of Rs 950 Crs to about Rs 1,050 Crs. That’s really the employee cost. Obviously, there are some productive efficiencies, there will be a salary hike and stuff like that. All absorbed put together, we see it between Rs 950 and 1,050 Crs. If we had some crazy teams, maybe a Rs 50 Crs number extra. This Rs 1,100 Crs broadly should represent approximately 34-35% of the overall revenues of the firm. - On the client addition and net flows, as I said earlier, slightly lower than I would have liked. Flows could have been between the 27k,28k or 35k Crs number as opposed to the 22 to 24k Crs number. 2 or 3 things here - one, the last couple of months, a little bit of longer time taken by clients to come back into financial assets especially equities. There has been a little bit of hesitations just given the market valuations. And secondly, from a business perspective, mostly they are coming out from a fairly high base, so that’s the only thing. But otherwise, most of our actions on both the high networth piece together with the expansion of the geographies should start playing out and our initiatives on growing both of these will more than supplement a little bit of little bit of slowness in the market. Overall, as I said earlier, there will be little bit of consolidation on wealth but, given the fact that we have spent a lot of time building some of these things out over the last 12-18 months, even in flattish markets, we may not be able to grow phenomenally but even if flattish numbers coming out of a higher base, we will still be able to maintain the high base, even on things like number of new families, their net flows, so on and so forth. The only matrix that definitely comes off the lid is the transaction and brokerage revenue, that obviously can’t necessarily sustain the same level. - Mr. Dipanjan Ghosh – Participant: - Got it Karan! Thank you and all the best. - Thank you.

- Thank you. Next in line we have Devrat Mohta. Devrat, kindly unmute and ask your question. - Mr. Devrat Mohta – Participant: - Hi Karan! Firstly congratulations on a good quarter. I just have one question. Obviously markets have been strong barring the last kind of 3-4 weeks. Markets have been so strong. Is there a risk that you are buying B&K at peak cycle? For broking business, you are at peak cycle. Why do you think that’s not the case because your own transaction incomes are super strong? SO I presume, B&K also would have had a very strong earnings. And if for some reason, the markets come off, is there a risk that you are probably , optical valuation look cheap or reasonable on a trailing basis but if you are on peak earnings, then it might end up being that you are paying more than what it looks like on…

- You are absolutely right! There are 3 points there. I don’t disagree with you. We need to just counter-balance it with 3 things. First, while transaction brokerage incomes are fairly wide term, the quality of income within the transaction of brokerage income also is something which we need to measure. Obviously there is one part of transaction income which is a one-time income on selling some unlisted shares or doing a certain transaction. The other part of income within transaction of brokerage income obviously is repetitive activity coming out of a relationship and out of a broking transaction being kind of conducted on a daily basis. Even between the two, there is a certain degree of difference in terms of variability. In B&K specific case, 95-96% of the revenues currently comes out of 2nd portion and not out of the 1st portion. So, while it will be linked to the market cycle, general variability between the 2 will be lesser compared to any other capital market player focused on ECM. So that’s the 1st thing. Second, while doing the acquisition, a lot of things have to align together. Maybe possible that earnings come off by 10-15% in a very worst case. From our assessment, just factoring in just all the 4 to 5 synergies which we have, our business as well as the synergies, we can add to B&K business. We feel from a management case perspective, taking a stressed basis, we should be able to add 30-40% to the earnings. So honestly from our perspective, the way we are looking at it synergistically, we should be able to make multiple even substantially more attractive than what we have acquired it for from a trailing basis. And thirdly, to acquire, I need a lot of stars to align in terms of culture, in terms of the likeliness to do business together, in terms of being maybe positioned is in a leadership position for both the businesses and most importantly, the will and willingness to build this together for a long period of time. This plays into the synergies and really expresses itself extremely well over the next 24 to 36 to 48 months. So potentially possible at the very worst case, if the markets go into a total tailspin that we ended up paying a little bit more, but just given the synergies and where we are, I would be really surprised that in the most probability, the answer would be no. And if at all that happens, over a period of 24 to 36 months, both the businesses have from a culture perspective and synergies perspective to add so much that it will end up being in a very very good position. That’s what we feel. - Mr. Devrat Mohta – Participant: - Thanks Karan. That was super helpful. Thank you.

- Thank you.

- Thank you. Next we have Sanket Godha. Sanket, please unmute and ask your question. - Mr. Sanket Godha – Participant: - Ya, thank you for the opportunity. Karan, in some fully diluted basis after warrants get converted into foreign equity, Sir the dilution comes closer to 3.3%. That’s the safe path.

- Yes approximately. - Mr. Sanket Godha – Participant: - Ok and just wanted to ask the 2nd question. Out of Rs 2,250 Crs of QIP that you raised, probably you will end up using Rs 700 Crs over a period of time to consume this acquisition. So is it fair to assume that the NIM which you were expecting to improve because of QIP might not play out to that extent? 2nd, I maybe forgot to ask, how much time will you take to consume this acquisition from regulatory point of view? Whether it will get fully reflected in 26 or somewhere in 27? - It will take about 4 to 6 months to consummate in terms of transaction. Just given our historical experience, 4 months is the right timeline to plan for but sometimes it can take a month or two more, at the very least I would say 3 months, on the outside I would say 6 months. From a business perspective, the way we have set-off the transaction is, all the accumulated earnings outside of Rs 200 Crs within the B&K profit and loss account till 31st March stay out of the transaction. Post 31st March, it comes into the 360 ONE, so it just adds to the networth and reduces the consideration value. So, from that perspective, may not fully reflect into the financials of FY26 but definitely from a valuation perspective, that’s the way it will get reflected. - Mr. Sanket Godha – Participant: - On the NIM part?

- I don’t think NIM gets impacted much but I think the 700 Crs, obviously we have got a design in plan to kind of reduce our allocation on the alternate side and, as we build it out over the next 12 to 18 months, our sponsor commitment remains more or less flattish and comes down close to Rs 1,400-1,500 Crs. It reduces the other income by round about 8-9% of the Rs 700 Crs. So, in that sense, it will have a PBT impact of Rs 50- 60 Crs and a PAT impact of Rs 45 to 50 Crs. - Mr. Sanket Godha – Participant: - Got it! Perfect! Just your flows numbers which are Rs 5,900 Crs in the current quarter, just want to understand, do you still have any component coming from HNI or global or is it predominantly UHNI?

- Right now, predominantly ultra HNI. The flow of high networth and global would be, both put together ~Rs 700-800 Crs. So, it’s not zero, it’s about 10% of the flows. But a large portion of the flows continue to be UHNI. We definitely expect the HNI and global flows to show up fully in FY26 and definitely from quarter 1 of next year. - Mr. Sanket Goda – Participant: - So, this Rs 700-800 Crs for the full year potentially would be like an estimate of 3x or 4x next year. What you intend this number to be?

- Should be at least 3x. - Mr. Sanket Goda – Participant: - Ok. And last one, last quarter we highlighted that some broker code change, regulatory change helped a bit in flows to improve for us. So given the flows numbers compared to last quarter, it is literally weak. So has it played out largely in Q2 or you expect this to flow out in subsequent quarters?

- So it continues to help every quarter little bit. What we are also talking about last quarter was not only the flows, well there is a little bit of improvement which we will see sequentially on the ARR side and on the mutual fund because after broker code change, after 6 months, the new broker starts getting the mutual fund commission. So even though the AUM starts reflecting, the trail commission really doesn’t increase for 6 months. So that’s something which will reflect little over a period of time. The AUM shift after the first 6 months comes pretty much business as usual because the clients have moved in the first 6 months itself but the revenue to come takes a little bit longer. - Mr. Sanket Godha – Participant: - Ok but have you seen, means given these rules have been changed for almost 9-10 months now, so in the 3rd quarter, did we have any revenue accretion because of broker code change? Is there a number in your mind if you remember it?

- There is ~0.5 bp to 1 bp overall increase in the ARR. Total increase in ARR is 2bps and a small bit comes from this. - Mr. Sanket Goda – Participant: - So 25-30% contribution came because of this delta improvement. - Yes. - Mr. Sanket Goda – Participant: - Ok, perfect! That’s it from my side. Thank you.

- Thank you. I would request Bhuvanesh Garg to kindly ask the question. - Mr. Bhuvanesh Garg – Participant: - Ya, thank you for the opportunity Sir. Sir, 2-3 questions from my side. Firstly on B&K acquisition, so just want to understand the thought process behind it. Was there any other place you were considering during the acquisition? Since you are saying that one of the objective for the acquisition is that clients were getting foothold on capital raising side. Since you didn’t have the capital raising proposition for your clients, now you are having it. Since the B&K has only 5% of its revenue from capital raising part of it, IB part of it, so if you can just share your thoughts on this. What was the thought process?

- No, nothing really different to add Bhubanesh. I already have spent some time on it but largely 3 portions – one obviously is, ensuring that we are able to complete the flywheel with the client. 2nd, on the banking side and obviously while in banking, we have still not built out a team within B&K but research is a critical part for the improvement of the product. So without having the strongest part, any franchise would need all 3 to come in and it would need research as a product, to meet the promoter relationships and thirdly, it would need access to both domestic as well as foreign institutions. Between the 2 of us, we get all 3 on the table and secondly, as I said earlier, it complements our high networth brokerage offering also very well. That’s been a bit of an area of improvement for us for a long time and without having the right research product, it’s tough to kind of take it to the market. So I see some good amount of mobility for us to be able to increase our equity brokerage on the wealth management side and thirdly on the corporate treasury side, we should be able to add a lot of value and be able to monetize those corporate accounts better and 4th a little bit of addition of balance sheet to the brokerage business of B&K will allow them to, even leverage their current research team better and be able to serve some larger clients on different platforms and different products. So these are the 4 immediate synergies that I can think of. - Mr. Bhuvanesh Garg – Participant: - Ok, understood. 2nd thing is on the interest income side. So, you mentioned that you wanted to be 20% of the revenues. So is it only driven by the contribution of revenue or is there any other parameter to drive your loan book? For example, next year your transaction income say would be lower, in that case would your interest book also be stable or are you looking at it to grow further?

- No, it’s not like that. We cannot really plan it that way. This is an output. It’s not really an input. For example, if you see our loan book typically tracks our wealth management AUM. So, our loan book typically tends to be 2.5 to 3% of the wealth management AUM and we have a 3-4% NIM there. So effectively, if you do a reverse calculation on the overall free revenue, you end up at round about 15-20% of the revenue pool on the net interest margin side. So that broadly seem, when I say suggest a good quality of mix of revenues, what I mean to say is that its healthy growth because as your AUM is growing, your loan book is also growing in the right proportion. That’s what I really meant by saying, net interest margin book should be around 18-20% mark. - Mr. Bhubanesh Garg – Participant: - Ok, understood. And thirdly, on your inflow side, if you can share some data, what will be our market share in inflows, in 9 months FY25 versus FY24? If you can just share some data.

- Usually, it’s tough to calculate market share but on a guesstimate basis what we see with clients, our stock of market share would be around 9-10% across all active wealth managers and if I were to look at incremental market share, maybe it will be slightly higher, in the 14-15% range but honestly, this is just a guess estimate basis. The feeling we have versus what we see on the ground in terms of competition, on the wealth management side, it’s really tough to calculate the market share on a day to day basis. - Mr. Bhuvanesh Garg – Participant: - Yes, yes. So incrementally means 9 months FY25 over FY24. - Yes. - Mr. Bhuvanesh Garg – Participant: - Ok, understood. Thirdly, any data on any revenue you are getting from ET Money side and what's the plan there with ET Money?

- As I have said earlier, we just got approvals for ET Money like yesterday. So, it’s not consolidated yet but ET Money financials have improved a lot over the last year. Broadly speaking, revenues have increased a bit, thanks to little bit of change in the regulation as well as little bit of change in the advisory revenues, cost has come down, so the overall burn stands at half of what it was last year and, as we take it over the next week or so, we hope to kind of drive it even in a more optimized way - Mr. Bhuvanesh Garg – Participant: - Any plans in the 3 - 5 year perspective on ET Money?

- Like our all the other businesses, we hope to grow, from a revenue perspective by 25- 35% and, maybe since ET Money comes with a slightly smaller base, I am hoping the profits at 30 to 50%. - Mr. Bhuvanesh Garg – Participant: - Ok, fine. That’s it from my side. Thank you.

- Thanks Bhuvanesh.

- Thank you. Thank you Karan. That’s what we have time for this evening. Thank you for taking time out for logging to our call. Have a nice evening. - Thank you everybody. Thanks for joining in.