Motilal Oswal Financial Services shares extended their losing streak to a fourth straight session on Friday, falling as much as 11% in intraday trade despite reporting strong Q1FY27 earnings. According to Business Standard, the stock opened marginally higher at ₹944.50 but soon reversed gains, hitting an intraday low of ₹839.90 on the National Stock Exchange. As of 12:10 PM, the stock was trading 8% lower at ₹863.50, significantly underperforming the markets with more than 10 million shares changing hands. The sharp decline came after the company's June quarter earnings highlighted that the sharp recovery in profit was largely driven by treasury gains, while operating performance across core businesses remained mixed. The market reaction reflects investor concerns about the sustainability of the profit turnaround and the mixed performance across key business segments.
Motilal Oswal Financial Services delivered a remarkable financial turnaround in Q1FY27, posting a consolidated net profit of ₹1,273.7 crore compared to a loss of ₹219 crore in Q4FY26. As reported by Business Standard, the profit rebounded from a loss of ₹219 crore in Q4 FY26, with profit before tax standing at ₹1,513 crore, up 10% YoY against the previous year. The turnaround was primarily aided by a fair value gain of ₹1,105 crore, which reversed a mark-to-market loss of ₹733 crore reported in Q4FY26. Fair value gains accounted for 32% of total revenue during the quarter, highlighting the significant contribution of treasury operations to overall profitability. The company's revenue from operations stood at ₹3,425.7 crore for the quarter ended June 2026 compared to ₹2,679.2 crore in the preceding year, demonstrating strong revenue growth momentum and marking a significant recovery from the preceding quarter's challenging performance.
The company's strategic focus on annuity revenues has yielded significant results, with 66% of revenue now coming from annuity businesses, helping improve the stability and predictability of earnings. As reported by Business Standard, Motilal Oswal Financial Services achieved a total Asset Under Management (AUM) of ₹2.12 trillion, representing a 31% year-on-year growth and marking a significant milestone as the company's highest-ever quarterly total PAT of ₹1,513 crore. However, client assets and AUM climbed to record levels, supported by buoyant equity markets, although net inflows moderated across both the Asset Management Company (AMC) and Private Wealth businesses. The asset management business emerged as the standout performer, recording its highest ever operating profit after tax (PAT) of ₹245 crore, a 73% YoY rise, contributing 40% to overall PAT. Within the asset management, mutual fund SIP inflows increased 16% to ₹4,064 crore with a market share of 4.2%, while AMC AUM grew 26% to ₹1.90 lakh crore. The housing finance business reported 36% YoY growth in profit after tax to ₹32 crore, with disbursements increasing 64% YoY to ₹646 crore and AUM growing 23% YoY to ₹6,164 crore.
Despite strong revenue growth, the company faced significant operational headwinds during the quarter. As reported by Business Standard, total operating expenditure increased 44.1% YoY to ₹1,838.22 crore, while interest expense rose 40.5% YoY to ₹414.24 crore. Employee expenses declined 1.1% YoY to ₹527.96 crore, and provisions and write-offs fell 12.0% YoY to ₹32.27 crore, while depreciation increased 6.7% YoY to ₹27.89 crore. The Capital Markets business reported a 25% YoY decline in operating PAT to ₹76 crore from ₹101 crore in the corresponding period last year, though the company maintained its second position in QIP and IPO league tables and ranked second in the Qualified Institutional Placement (QIP) and Initial Public Offering (IPO) league tables during the quarter. The treasury book expanded 22% YoY to ₹10,482 crore, with CRISIL upgrading the company's long-term credit rating to AA+ with a Stable outlook during the quarter.
Technical analysts are closely monitoring Motilal Oswal's stock movement amid the recent volatility. According to Prithvi Finmart, Harish Jujarey, head of technical equity research, noted that the stock is now testing its 200-day moving average near ₹860, making this a crucial support level. He warned that a decisive close below the 200 DMA could extend the correction towards the ₹800-810 support zone, while on the upside, the stock will regain positive momentum only after a sustained move above ₹950. Jujarey advised that until a clear reversal or a strong support-based setup emerges, it is advisable to avoid fresh buying and wait for a more favorable risk-reward opportunity. Speaking to Business Standard, MOFSL Chairman Raamdeo Agrawal provided insight into the company's outlook and market conditions, expecting retail broking activity to improve in FY27 after regulatory headwinds impacted the business in the previous fiscal.
