Press Release March 13, 2026 Monarch Networth Capital Limited Rating Assigned

Product	Quantum (Rs. Cr)	Long Term Rating	Short Term Rating
Commercial Paper (CP)	200.00	-	ACUITE A1+ | Assigned
Total Outstanding	200.00	-	-
Total Withdrawn	0.00	-	-

Rating Rationale

Acuité has assigned the short-term rating of ‘ACUITE A1+’ (read as ACUITE A one plus) on the Rs. 200.00 Cr. Proposed Commercial Paper Facility of Monarch Networth Capital Limited (MNCL). Rationale for Rating The rating factors in the company’s strong capital structure, diversified revenue profile, experienced management, and its well-established position within the segment. It also reflects the group’s low-leveraged profile, and a continuous improvement in earning profile over the years alongside  with low debt and a gearing of 0.01x as on March 31, 2025. The company's net worth stood at Rs 796.79 crore as of  March 31, 2025. Acuité further takes cognizance of MNCL’s diversifying revenue base through the Investment Banking, Alternative Investment Funds segments apart from income from Brokerage and  Margin Trade Facility and third party products.The company has recently started its Portfolio Management services. Further the company has received the in principle approval from SEBI to start their Mutual Fund business and it is awaiting final approval to commence operations. The company has also secured a Registered Fund Management Entity ( Retail) license from IFSCA to operate in GIFT city. For 9MFY26 , the company reported a consolidated total income of Rs 273.75 Cr. as against Rs 266.16 Cr. for 9MFY25 along with a PAT of Rs. 135.64 Cr. for 9MFY 26 as against Rs. 124.55 Cr. for 9MFY25.  However, the rating is constrained by MNCL’s modest scale of operations in other segments apart from brokerage and Margin Trading Facility, its revenue susceptibility to volatility and turnover levels in the capital markets, and the intensely competitive nature of the broking industry. Going forward, continued promoter support, capital raise and the company’s ability to enhance its operating performance will remain key monitorables.

About the Company

­Monarch Networth Capital Limited Gujarat based, Monarch Networth Capital Limited incorporated in 1993 is a listed entity and a financial conglomerate with service offerings ranging across retail broking, institutional equities, investment banking, fund management, wealth and third party products. Mr. Vaibhav Shah, Mr. Manju Suresh Bafna, Mr. Sathish Kumar, Mr. Ashok Daulatraj Bafna, Mrs. Avni Chouhan, Mr. Anish Sugathan are directors of the company.

About the Group

Monarch Group With over three decades of existence, Monarch Networth Group has established itself as a diversified financial service house. The service offerings have been extended from the traditional retail broking and wealth management to include institutional equities, investment banking, fund management through AIF route. Strengthening its growth strategy, the Group has forayed into portfolio management services and recently expanded its asset management business through the incorporation of Monarch Networth Capital IFSC Private Limited at GIFT City, and Monarch Networth Asset Management Private limited. The company has received the in principle approval from SEBI to start their Mutual Fund business and is awaiting final approval from the regulator to commence operations.

Unsupported Rating

­Not Applicable

Analytical Approach

Extent of Consolidation

•Full Consolidation

Rationale for Consolidation or Parent / Group / Govt. Support

For arriving at the rating, Acuite has considered a consolidated approach for Monarch Networth Capital Limited (MNCL). The consolidated approach takes into consideration the business and financial risk profile of all the subsidiaries of MNCL.

Key Rating Drivers

Strength

Experienced management team and board  The company has a strong board and  experienced management team . Mr. Gaurav Bhandari , the CEO, brings over  20 years of rich experience in the financial markets and has previously served in key strategic roles at Centrum Broking and ICICI Securities.  Mr. Vaibhav J. Shah, Co-founder and  Managing Director brings experience of over three decades in financial markets. Under his visionary leadership, the Group is entering a transformative growth phase. Shah’s commitment has earned the Company several accolades, and he has played a key role in expanding its operations, branch network, media presence, and brand reach. Ms. Manju Bafna, Chairman and Whole time Director has over 30 years of experience in Capital Markets and administrative affairs. Mr. Ashok Bafna Whole time Director, brings more than two decades of experience in broking and oversees the company's business affairs.  Healthy Capitalisation levels The Company’s capitalisation profile remains healthy, supported by a significant equity infusion of Rs 300.21 crore through a preferential issue in August 2024 ( Rs 100 Cr. infused by the promoter , Rs 25 Cr. infused by the CEO and the remaining portion by multiple marquee investors) . This equity raise enabled a substantial reduction in borrowings during FY25, bringing the debt-to-equity ratio down to 0.01x. The Company’s net worth also improved sharply—from Rs 345.91 crore in FY24 to Rs 796.79 crore in FY25 (compared with Rs 221.80 crore in FY23). The strengthening trend continued in the current fiscal, with net worth rising further to Rs 925.06 crore as of December 2025, supported by a PAT of Rs 135.64 crore for 9MFY26. Going forward, securing additional capital will be important to sustain the Company’s growth momentum, and the capitalisation levels will remain key monitorables. Diversified earning profile The company has a diversified revenue profile, comprising income from Brokerage; interest on MTF, Debtors book and Fixed Deposits pledged with the exchanges; Investment Banking and Asset Management Business. The Company's revenue breakup in FY25 comprises of ~36 percent from Stock Broking, followed by 34 percent from interest on MTF, Debtors book and Fixed Deposits pledged with the exchanges, ~19 percent from the Investment Banking while remaining from AIF, Mutual fund distribution and Net Gain on fair value changes. Share of Broking and related interest income has been on a decline in the overall revenue mix , the share has declined to ~70 percent in FY 25 from 82.50% in FY22.  The group has received in-principle approval from SEBI during the year to commence its Mutual Fund operations. Accordingly, the Asset Management Company (AMC) and the Trustee Company have been incorporated. The entities have completed all key management appointments and are currently in the process of securing the final approval from SEBI to commence Mutual Fund – Asset Management business. The company is in the process of launching a fourth AIF in the coming months. For 9MFY26, the company reported a consolidated total income of Rs 273.75 Cr.  as against Rs 266.16 Cr. for 9MFY25 along with a PAT of Rs 135.64 Cr. for 9MFY 26 as against Rs 124.55 Cr. for 9MFY25.

Weakness

Regulatory Risk and susceptibility to Market volatility The Company remains exposed to regulatory risk, as frequent changes in compliance norms and margin rules—along with recent SEBI circulars mandating higher security cover for MTF funding, new proprietary trading guidelines, and evolving risk-management frameworks—can impact operations and influence industry-wide trading behaviour. Its performance is also closely linked to capital market conditions, which are inherently volatile and affected by economic trends and investor sentiment. Revenues from broking, wealth management and advisory services depend on overall market turnover; hence, periods of subdued activity can compress commission income. In a competitive landscape dominated by established and technology-driven players, the Group’s ability to sustain and grow brokerage revenues will remain a key monitorable.

ESG Factors Relevant for Rating

­The Company acknowledges the critical interconnection between sustainability and long term financial performance and is committed to embedding Environmental, Social, and Governance (‘ESG’) considerations into every aspect of its business and operational decision making.  The company aims to continuously enhance the ESG stand through active collaboration with all stakeholders—including employees, clients, investors, regulators, and communities—to drive sustainable value creation. The Company is focused on transparent ESG governance, measurable targets, and regular monitoring to ensure accountability and continuous improvement. By integrating ESG principles, the company aims to mitigate risks, capitalize on opportunities, and contribute meaningfully to environmental stewardship, social well-being, and ethical governance, aligning with global best practices and regulatory expectations.

Rating Sensitivity

Potential triggers (individual or collective) for an upward rating action:

­Not Applicable

Potential triggers (individual or collective) for a downward rating action:

Any significant change or dilution in the shareholding pattern or reduced support from the promoter/major shareholders. Deterioration in profitability metrics due to sharp adverse movements or heightened volatility in capital markets. Impact of any material changes in the regulatory environment on business operations. Adverse shift in the revenue mix, marked by a steadily rising share of income from proprietary trading—particularly if such income approaches or exceeds 50% on a sustained basis.

Liquidity Position

Adequate

­Business growth of Monarch Networth Capital Limited has been supported by the group’s internal accruals, the company’s dependence on debt is very low as reflected in low gearing of 0.01 times as on March 31 , 2025 . The company has no significant term debt obligations over the near term. The company currently has cash and cash equivalents and balance of Rs 532.5 crore as of September 30, 2025 and Rs 389.67 crore as of December 31, 2025. MNCL has fund based and non-fund based Bank Guarantee limit to meet margin requirements which are approximately Rs 291 crore as of December 31, 2025 and Overdraft/ Working Capital term loan of Rs 25 crore limit to meet margin requirements as well as fund debtor/ MTF book.

Outlook

­Not Applicable

Other Factors affecting Rating

­None

Key Financials (Consolidated)

­ Particulars Unit FY25 (Actual) FY24 (Actual) Total Assets** Rs. Cr. 1234.50  807.08  Total Income* Rs. Cr. 310.32       265.97 PAT Rs. Cr. 149.27      123.15 Net Worth Rs. Cr. 796.79       345.91 Return on Average Assets (RoAA) (%) 14.62       17.42 Return on Average Net Worth (RoNW) (%) 26.12       43.38 Debt/Equity Times 0.01    0.33 Gross NPA (%) - - Net NPA (%) - - ** Adjusted for deferred tax assets * Total Income is equal to Net Interest Income plus other income

Status of non-cooperation with previous CRA (if applicable)

None

Any Other Information

­None

Applicable Criteria

• Banks And Financial Institutions: https://www.acuite.in/view-rating-criteria-45.htm • Default Recognition: https://www.acuite.in/view-rating-criteria-52.htm • Application Of Financial Ratios And Adjustments: https://www.acuite.in/view-rating-criteria-53.htm • Consolidation Of Companies: https://www.acuite.in/view-rating-criteria-60.htm • Commercial Paper: https://www.acuite.in/view-rating-criteria-54.htm

Note on complexity levels of the rated instrument

­In order to inform the investors about complexity of instruments, Acuité has categorized such instruments in three levels: Simple, Complex and Highly Complex. Acuite’s categorisation of the instruments across the three categories is based on factors like variability of the returns to the investors, uncertainty in cash flow patterns, number of counterparties and general understanding of the instrument by the market. It has to be understood that complexity is different from credit risk and even an instrument categorized as 'Simple' can carry high levels of risk. For more details, please refer Rating Criteria “Complexity Level Of Financial Instruments” on www.acuite.in.

Rating History :

­Not Applicable

Annexure - Details of instruments rated

Lender’s Name ISIN Facilities Date Of Issuance Coupon Rate Maturity Date Quantum (Rs. Cr.) Complexity Level Rating Not Applicable Not avl. / Not appl. Proposed Commercial Paper Program Not avl. / Not appl. Not avl. / Not appl. Not avl. / Not appl. 200.00 Simple ACUITE A1+ | Assigned

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*Annexure 2 - List of Entities (applicable for Consolidation or Parent / Group / Govt. Support)

Sr. No. Name of the companies  1 Monarch Networth Capital Limited 2 Monarch Networth Finserve Private Limited 3 Monarch Networth Capital IFSC Private Limited 4 Monarch Networth Investment Advisors Private Limited 5 Monarch Networth Asset Management Private Limited 6 Monarch Networth Trustee Private Limited ­

Contacts

Mohit Jain Chief Analytical Officer - Rating Operations Nattasha Venkatesh Analyst - Rating Operations	Contact details exclusively for investors and lenders Mob: +91 8591310146 Email ID: analyticalsupport@acuite.in

About Acuité Ratings & Research

Acuité is a full-service Credit Rating Agency registered with the Securities & Exchange Board of India (SEBI). The company received RBI Accreditation as an External Credit Assessment Institution (ECAI) for Bank Loan Ratings under BASEL-II norms in the year 2012. Acuité has assigned ratings to various securities, debt instruments and bank facilities of entities spread across the country and across a wide cross section of industries. It has its Registered and Head Office in Kanjurmarg, Mumbai. Disclaimer: An Acuité rating does not constitute an audit of the rated entity and should not be treated as a recommendation or opinion that is intended to substitute for a financial adviser's or investor's independent assessment of whether to buy, sell or hold any security. Ratings assigned by Acuité are based on the data and information provided by the issuer and obtained from other reliable sources. Although reasonable care has been taken to ensure that the data and information is true, Acuité, in particular, makes no representation or warranty, expressed or implied with respect to the adequacy, accuracy or completeness of the information relied upon. Acuité is not responsible for any errors or omissions and especially states that it has no financial liability whatsoever for any direct, indirect or consequential loss of any kind, arising from the use of its ratings. Ratings assigned by Acuité are subject to a process of surveillance which may lead to a revision in ratings as and when the circumstances so warrant. Please visit our website (www.acuite.in) for the latest information on any instrument rated by Acuité. Please visit https://www.acuite.in/faqs.htm to refer FAQs on Credit Rating. Note: None of the Directors on the Board of Acuité Ratings & Research Limited are members of any rating committee and therefore do not participate in discussions regarding the rating of any entity.