Stonegate Capital Partners has initiated coverage on Choice International Ltd. (NSE: CHOICEIN), spotlighting the company's impressive start to FY26 with a 16% year-over-year revenue increase to ₹2.38B in the first quarter. The firm's EBITDA and PAT saw substantial rises of 49% and 50%, respectively, attributed to enhanced operational efficiency and a notable margin expansion. With a growing network of 208 branch offices and over 58,000 Choice Business Associates, Choice International is poised to maintain its annual growth target of 25–30%.
The broking segment, accounting for approximately 60% of total revenue, demonstrated steady growth, with client assets under broking reaching ₹478B, a 16% increase from the previous year. The company's digital engagement is strengthening, with 67% of broking revenue now generated online. Wealth management emerged as a high-growth area, with assets under management soaring 443% y/y to ₹47.7B, bolstered by the acquisition of Arete Capital’s wealth business.
Choice International's insurance distribution business also showed promising growth, with retail and corporate premiums totaling ₹390M and ₹539M, respectively. The NBFC segment reported a doubling of its retail loan book to ₹5.96B, with stable credit quality and an expanding NIM. The government advisory segment secured a ₹5.86B order book, while the investment banking division is actively managing 24 mandates with a significant fundraising pipeline.
Stonegate Capital Partners' valuation of Choice International Ltd. utilizes a DCF Model, EV/Operating Income comp analysis, and P/E analysis, suggesting a valuation range with a mid-point around $9.12 to $9.58. This coverage initiation underscores Choice International's robust growth trajectory and its potential to capitalize on India's expanding financial services sector. For more details, visit https://www.stonegatecp.com.
