Choice International Ltd Q2 FY26 FY25 — “The Curious Case of the 92x P/E, 67% Profit CAGR, and SEBI’s Mutual Fund Blessing”
1. At a Glance
Ladies and gentlemen, welcome to Choice International Ltd, a financial conglomerate so diversified that even its Excel sheets need an index page. At ₹819 a share and a P/E of 92.9, this ₹16,843 crore market cap wonder looks less like a financial services company and more like a mutual fund of its own ambitions.
The stock has jumped 66% over the past year, outpacing most of its peers, and just when you thought it couldn’t surprise further, SEBI handed it a Mutual Fund sponsorship license. Yes, your broker might soon be your fund manager too — a setup that even Christopher Nolan would call “too many layers.”
Q2 FY26 results weren’t shy either: Revenue ₹274 Cr (+10.9% YoY), PAT ₹56 Cr (+20.1% YoY), and ROE ~19.6%. But behind these shiny digits lurk warrants, acquisitions, and subsidiaries that multiply faster than YouTube finance gurus after Budget Day.
Let’s open the case file.
2. Introduction
When a company runs a broking arm, an NBFC, an investment bank, a consultancy, a government advisor, and now a mutual fund — you don’t call it diversification, you call it financial schizophrenia.
Incorporated in 1993, Choice International Ltd (CIL) began humbly as a broking firm. Three decades later, it’s now advising governments, managing assets, lending to MSMEs, and building solar plants. Somewhere between Power of Attorney and PowerPoint presentation, Choice found a way to become the “Swiss Army Knife” of Indian finance.
The company’s story reads like a detective thriller — a mysterious figure rising from Dalal Street’s fog, expanding through subsidiaries, pulling off acquisitions like magic tricks, and ending every quarter with a “record growth” headline.
But if you, dear reader, have ever wondered how a financial firm with a ₹971 Cr annual revenue and ₹181 Cr profit gets a ₹16,800 Cr valuation — congratulations, you’ve joined this investigation at the perfect time.
Because in the world of Choice, even the numbers need background checks.
3. Business Model – WTF Do They Even Do?
Imagine if a financial services buffet existed — Choice is that restaurant.
Division 1: Broking & Distribution (~65% revenue) This is the company’s bread and butter — or rather, brokerage and butter chicken. With over 1.2 million clients and ₹465 billion in stock broking AUM, they sell everything from stocks to insurance, mutual funds, and “wealth products” (which often means mutual funds of other people).
Division 2: Advisory Services (~23%) The Consulting arm — where Choice tells governments and corporates how to build roads, housing projects, and public infrastructure. It’s the rare broking company that can help both a day trader and a district collector in the same day.
Division 3: NBFC (~12%) Under Choice Finserv, this division lends to MSMEs, with a loan book of ₹7.54 billion and an NPA profile so clean it could be in a detergent ad — NNPA ~0%, CRAR 21.31%.
And now — Division 4 (Under Construction) — the Choice Mutual Fund, courtesy SEBI’s nod. Expect ETFs, passive products, and a marketing tagline like: “You’ve traded with us, now let us trade for you.”
4. Financials Overview
Source table
Metric
Latest Qtr (Q2FY26)
Same Qtr Last Year
Prev Qtr
YoY %
QoQ %
Revenue
₹274 Cr
₹247 Cr
₹234 Cr
10.9%
17.1%
EBITDA
₹89 Cr
₹76 Cr
₹83 Cr
17.1%
7.2%
PAT
₹56 Cr
₹46 Cr
₹48 Cr
21.7%
16.7%
EPS (₹)
2.69
2.31
2.19
16.5%
22.8%
Commentary: That’s a clean quarter. Revenue up double digits, PAT growing faster than the inflation rate of Indian weddings, and margins holding firm at ~33%. EPS at ₹2.69 implies annualized ₹10.76, giving us an uncomfortably cozy P/E of 76x (TTM still 92x).
The market’s clearly pricing in divine intervention — or maybe the SEBI license hype. Either way, Sherlock is raising an eyebrow.
5. Valuation Discussion – The Fair Value Range
Let’s play “How much should it actually be worth?”
a) P/E Method
EPS (annualized): ₹10.76 Industry average P/E (Financial Services): ~20x Fair range: ₹215–₹260
b) EV/EBITDA Method
EBITDA (TTM): ₹328 Cr EV/EBITDA (sector avg): 15–20x Implied EV = ₹4,920–₹6,560 Cr Minus net debt ₹488 Cr → Equity Value: ₹4,430–₹6,070 Cr Per share (20.6 Cr shares): ₹215–₹295
c) DCF (simplified)
Assume FCF growth 20% for 5 years, WACC 11%, terminal 5% → Intrinsic value: ₹280–₹340 per share.
📏 Fair Value Range (Educational Only): ₹215 – ₹340 per share. CMP ₹819 → The market’s optimism premium = “unlisted asset in your head” markup.
Disclaimer: This fair value range is for educational purposes only and is not investment advice.
6. What’s Cooking – News, Triggers, Drama
Q2FY26 was spicy. Let’s recap the masala:
SEBI License for Mutual Fund: Choice got approval to start “Choice Mutual Fund,” focusing on passive products. ETF boom incoming.
Acquisition of Fintoo Wealth (Oct 2025): 51% stake for ≤ ₹10 Cr. Subsidiaries buying Fintoo’s distribution business for ≤ ₹15 Cr. Translation: The empire expands.
Acquisition spree earlier: Arete Capital (₹36 Cr), Choice AMC (₹62.5 Cr), retail lending biz from Paisabuddy & Sureworth.
Government consultancy jackpot: Subsidiary CCSPL bagged ₹140 Cr in new mandates for housing, water, MSME, and urban projects.
Solar plant order: ₹520 Cr project with Solar91 for Jodhpur Vidyut Vitran Nigam.
