MOTILAL OSWAL FINANCIAL SERVICES Q2 CONCALL: TARGETS 24–25% HOUSING FINANCE GROWTH OVER 3 YEARS; ₹3,000 CR PRIVATE CREDIT FUND NEARS CLOSURE, CUSTODIAN BUSINESS TO LAUNCH IN Q4 & SIF LAUNCH PLANNED FOR JANUARY 2027

• Housing Finance Growth Outlook: Management expects the housing finance business to sustain growth broadly in line with its recent 24% YoY AUM expansion over the next three years. • Housing Finance Asset Quality Guidance: Management expects gross NPA to normalize toward 1.1–1.2% during H2 FY27, supported by recoveries and improving collection trends. • Asset Management Growth Outlook: Management expects continued AUM growth through strong SIP inflows, improving fund performance, new product launches and a higher proportion of schemes completing three years. • AMC Net Flow Outlook: Management expects active mutual fund inflows to sustain their recovery, supported by fund performance and increasing distributor participation. • Active Mutual Fund Inflows: Management reported approximately ₹2,400 Cr of net active inflows in September and expected more than ₹2,000 Cr in October 2026. • SIP Growth Outlook: Management highlighted an annualized SIP run rate of approximately ₹18,000 Cr as an important driver of future mutual fund AUM growth. • SIF Launch Plans: Management indicated that the launch of Specialized Investment Funds is being targeted around January 2027, alongside expansion into hybrid products. • AMC Product Expansion: Company plans to enter pension products, launch outbound GIFT City funds and broaden its hybrid investment offerings. • Mutual Fund Scheme Maturity: Management expects funds in key categories, including small-cap, large-cap and multi-cap, to complete three-year track records over the coming months, potentially improving distributor allocations. • AMC Fund Vintage: Company expects the number of funds with more than three years of operating history to increase from six currently to eight by March 2027 and 16 by March 2028. • Mutual Fund Market Share: Company's net flow market share reached approximately 6% in September, compared with an AUM market share of 2.7%. • AMC Fund Performance: Management stated that approximately 99% of AUM outperformed respective benchmarks over the preceding three-year period. • AMC Scheme Expansion: Company now has 24 schemes with AUM exceeding ₹1,000 Cr each, compared with 16 schemes last year. • Passive Fund Expansion: Passive fund AUM crossed ₹50,000 Cr, supported by continued expansion of the company's passive investment offerings. • AMC Investor Base: Unique investor PAN count crossed 1 Cr as of September 2026. • AMC Average AUM: Average AUM reached approximately ₹2.01 lakh Cr by September 2026, compared with ₹1.67 lakh Cr in March 2026. • Q2 SIP Collections: SIP flows stood at approximately ₹4,170 Cr during the quarter, representing around 4.4% market share. • Alternatives Fundraising: Company's maiden private credit fund is approaching its ₹3,000 Cr final-close target, with more than 90% of the fundraising completed. • Commercial Real Estate Fund: Company launched its maiden commercial office real estate fund, with management targeting completion of fundraising over the next six months. • Future Alternatives Launches: Management expects to launch additional fund series during calendar year 2027, supported by growing allocations from institutions and family offices. • Alternatives Carry Income: Carry income stood at approximately ₹108 Cr during Q2, primarily supported by two mature investment schemes. • Carry Income Outlook: Management expects carry income to become a growing contributor as additional alternative investment funds mature and meet recognition thresholds. • Asset Management Profit Contribution: Asset management contributed approximately 43% of group operating PAT during Q2, compared with 31% YoY. • Private Wealth Growth Outlook: Management expects stronger PAT growth during H2 FY27 compared with H1, supported by improving relationship-manager productivity and higher client monetization. • Private Wealth AUM: AUM increased 58% YoY to ₹2.96 lakh Cr, supported by strong client additions and investment flows. • Private Wealth Net Flows: Net inflows increased 65% QoQ to ₹6,357 Cr. • Private Wealth Recurring Revenue: Q2 annual recurring revenue stood at approximately ₹180 Cr. • Relationship Manager Expansion: Management will continue selective hiring, particularly in the ultra-high-net-worth segment, while focusing on improving productivity from existing teams. • RM Productivity Outlook: Management indicated that relationship managers typically break even within approximately one year and become profitable contributors within 2–3 years. • Private Wealth Client Flows: Approximately 20% of net flows come from newly acquired customers, with the majority generated through deeper relationships with existing clients. • Wealth Management ARR Growth: Recurring revenue increased 10% YoY to ₹328 Cr, supported by distribution income and net interest income. • Distribution Business: Distribution AUM increased 26% YoY to ₹48,000 Cr, with management targeting further growth through cross-selling. • Cross-Selling Opportunity: Management indicated that current cross-selling penetration stands at approximately 18%, leaving scope for deeper product adoption. • Retail Lending Growth: Wealth management lending book increased 42% YoY to ₹10,200 Cr, supported by margin trading funding and loan-against-shares products. • Broking Market Share: Overall retail broking market share, including commodities, stood at approximately 7.9% during Q2. • F&O Market Share: F&O premium market share improved to 8.8% from 7.6% QoQ, while cash market share increased to 8% from 6.8%. • Broking Outlook: Management expects growth to improve as the impact of earlier regulatory changes and subdued market conditions becomes part of the comparison base. • Institutional Equities Expansion: Company has expanded institutional research coverage beyond 400 companies and targets coverage of approximately 500 companies. • Investment Banking Performance: Company completed 41 transactions during H1 FY27, raising a cumulative ₹99,000 Cr. • Investment Banking Fee Income: Quarterly fee income increased 39% QoQ to ₹94 Cr. • Capital Market Rankings: Management stated that the company ranked first in QIP transactions and third in IPOs during H1 FY27, based on capital markets league tables. • Custodian Business Approval: Company received SEBI approval to operate as a securities custodian, expanding its institutional financial services offerings. • Custodian Business Launch: Management expects operations to commence during Q4 FY27, subject to operational readiness, with the CEO and senior leadership team already appointed. • Custodian Revenue Outlook: Management does not expect a meaningful financial contribution from the new business during FY28 and has not provided numerical revenue guidance. • Housing Finance Performance: Disbursements increased 29% YoY to ₹701 Cr, while AUM increased 24% YoY to ₹6,476 Cr. • Housing Finance Funding: Management indicated that the business has adequate capital and low leverage to support growth without requiring external equity funding. • Housing Finance Asset Quality: Management reported lower YoY delinquencies across early and late overdue categories and expects further improvement during H2. • Treasury Investment Book: Treasury investments increased 27% YoY to ₹11,346 Cr. • Treasury Portfolio Allocation: Management indicated that approximately 98% of the treasury portfolio is invested in equities, with significant exposure to its own mutual funds, alternative funds and direct equities. • Recurring Revenue Contribution: Annual recurring revenues now contribute approximately 66% of group revenue, compared with 55% in FY24. • Asset & Private Wealth Profit Contribution: These businesses contributed approximately 57% of group PAT during H1 FY27, compared with 39% in FY24. • Q2 Operating Profitability: Management reported operating PAT growth of approximately 29% YoY to ₹718 Cr, supported by asset management and private wealth businesses. • Asset & Private Wealth Profit Growth: Combined operating PAT from these businesses increased approximately 43% YoY during Q2. • Combined Wealth & Asset Management AUM: Management reported AUM of approximately ₹5.2 lakh Cr for asset and private wealth businesses, up 42% YoY. • Insurance Revenue Exposure: Insurance accounted for approximately 3% of wealth management operating revenue and 7% of housing finance revenue, according to management. • Key Challenges: Regulatory changes affecting broking, market-linked mutual fund flows, performance-dependent carry income, increasing competition, costs of relationship-manager expansion and execution of the new custodian business remain important factors.

MOTILAL OSWAL FIN LTD

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