360 ONE WAM Ltd

Ready to Embrace A Fast Changing Tomorrow

As we reflect on the past year, I present our Annual Report with great pride and optimism. Our theme, ‘Growth Focused Future Ready,' comes when India is on a robust trajectory to become the third largest economy in the world by 2030, bolstered by an impressive GDP growth rate of approximately 8%. This remarkable economic dynamism is mirrored in our stock markets, which have soared to new highs, fuelled by expectations of sustained growth.

Increasing Prosperity

With the population of UHNIs set to grow at a rapid pace of 13-14% CAGR over the next 4-5 years, India is poised to witness the highest rise in the ultra-rich globally. This increase signifies a remarkable demographic shift and a decentralised pattern of wealth creation across the country.

The fiscal year saw an unprecedented surge in market activity with over 150 OFS/IPOs and 600+ stake sales, collectively unlocking nearly $27 billion in value. Notably, India is also the fastest-growing economy in the world, hosting the third-largest startup ecosystem globally.

The concentration of UHNIs and HNIs has diversified beyond the traditional 10-15 cities to over 60 cities¹, reflecting a significant demographic transformation. India is predicted to see an 85% increase in millionaires by 2034.

Growth Potential for 360 ONE

For 360 ONE, this dynamic landscape offers a unique launchpad for exponential growth. Our strong position in the industry enables us to set a high target for ourselves in the coming years. Tapping into the HNI population will help us improve our market penetration. The wealthy in India are increasingly keen on wealth planning and curating their finances with a clear future aim. They want their capital held and managed efficiently and seamlessly transferable from one generation to the next. They want to move beyond the traditional investment avenues of gold and real estate and capitalise on new investment opportunities across the risk spectrum.

Expanding Horizons

India's managed investments are expected to more than double from 135 lakh Cr in 2022 to 315 lakh Cr in 2027². The asset management industry, including mutual funds and alternates, has also seen significant growth. Over the past five years, the assets managed have increased from 26 lakh crore to 68 lakh crore³. This is a huge market opportunity for organised wealth management players in India. To tap these underserved markets and increase our penetration, we will continue to enhance our presence in tier II and tier III cities. During the year, we also brought on board a dynamic team to service the global Indian and launched 360 ONE Global. With 30 Mn people, India's diaspora is the largest in the world, spanning the globe and actively seeking investment opportunities.

As a firm, we have always believed in defining our strategic focus areas, creating deep competitive moats, and giving balanced attention to execution. For us, FY25 would be the year 360 ONE consolidates its position in the industry and takes confident strides to pave the way for future success. I am confident that with our strategic focus, robust business model, risk appetite, strong values, and conviction, we will soon translate new business opportunities into success.

Gratitude

On behalf of the Board of Directors, I extend my heartfelt gratitude to all our stakeholders and investors for their unwavering support. Your trust and faith have allowed us to remain steadfast in our pursuit of excellence, delivering value and sustained growth to our clients and employees. We remain committed to upholding the highest levels of corporate governance and generating positive outcomes for all stakeholders. We are dedicated to seizing emerging opportunities and delivering long-term value to our clients, employees, and stakeholders. Thank you for being a vital part of our journey.

Dear Shareholders,

India's economic landscape is experiencing remarkable growth, creating immense opportunities for wealth creation. The country's market capitalisation recently exceeded $5 trillion, driven by significant listings and a surge in domestic stock market value. We now stand among global economic giants like the US and China.

After a roller coaster ride in 2023, the world economy looks comparatively stable in 2024 despite ongoing geopolitical concerns in the Middle East. It is forecasted to grow at 3.2%¹ during 2024 and 2025, showing improvement as inflation eases across nations. The year 2023 was marked by aggressive monetary tightening by most Central banks battling inflation. While Europe struggled to regain growth momentum, the US economy showed remarkable resilience, with its job market and consumer spending staying surprisingly strong.

India's Dream Run

Amid sluggish global growth trends, the Indian economy has defied expectations, achieving over 8% growth for three consecutive quarters of FY24. High-frequency data, including multi-year high PMI and GST collections, along with the financialisation of assets and global inflows, underscore the India growth story. This favourable financial climate has led to one of the most buoyant market cycles for Indian equities, resulting in accelerated wealth generation.

At 360 ONE, we are uniquely positioned to benefit from this environment and remain our clients' first port of call for wealth management. Our bespoke services, tailored to Ultra-High-Net-Worth Individuals (UHNIs) and High-Net-Worth Individuals (HNIs), ensure personalised attention, independence, and the highest level of expertise.

It's not just about wealth generation but also a sustained increase in the deployment of patient capital towards alternatives. Currently, the wallet share of alternatives in the HNIs & UHNIs segments is less than 3-5% of financial assets. We anticipate this share to grow steadily to 8-10% over the next 4-5 years. Despite stellar growth over the last couple of years, India's Mutual Fund pool as a share of GDP is only 15% compared to the global average of 70%+, leaving significant room for expansion.

Building a Strong Base

At 360 ONE, we are poised to accelerate our growth, propelled by India's macroeconomic stability. We initiated an internal transformation over the last few years, beginning with a shift to the recurring revenue model in 2020. Since then, we have invested strategically in people, propositions, platforms, and processes to achieve our current business scale. Our business has excelled on all critical metrics in the last five years, creating a solid foundation for robust future growth. We identified two key growth segments: the Advisory proposition for our Wealth business and the Alternates-focused AMC business. I am pleased to report that these segments have expanded by 3.5-4x in the last four years, with AUMs now at approximately 72k Cr each.

High-Caliber Workforce

We hire the best talent in the industry to build deep relationships with our clients. For FY24, we added 35+ new hires at or above the partner level in the Wealth Sales team to significantly expand our market coverage and penetration. We have recruited an excellent team to set up our global platform. With their deep research-driven market expertise, these investment experts think beyond market phases to achieve long-term success for our clients. Our employee retention remains industry-leading, with voluntary attrition at around 5% for FY24.

Robust Technology

360 ONE has been at the forefront of tech and digital innovation. Our platform offers a comprehensive suite of products and services. We use cutting-edge technology for client portfolio reporting, in-depth analysis, and data aggregation. Our commitment to broadening and deepening overall cybersecurity coverage has fortified our position as a trusted industry leader. We have also embarked on creating a Master Data system, allowing us to establish a single source of truth, enabling accurate and reliable information for our employees and clients.

Financial Performance

We are pleased to report a robust performance for the past year. We welcomed over 400 new clients, each with Assets Under Management (AUM) exceeding 10 Cr, increasing our total number of such clients to more than 2,750. Our Annual Recurring Revenue (ARR) for the year saw a year-over-year (YoY) growth of 13.6%, reaching 1,331 Cr, driven by growth in assets across various business segments and strong retention rates in Active ARR AUM.

Total Revenue from Operations increased by 17.9% YoY to 1,846 Cr for FY24. Total Revenues grew by 25.3% YoY to 1,965 Cr for FY24. Our total costs rose by 33.1% YoY to 956 Cr, primarily due to the addition of several large teams in the wealth segment and investments in the High Net Worth Individuals (HNI) and global business segments. Our Profit After Tax (PAT) for the full year stood at 802 Cr. Tangible Return on Equity (RoE) was 30.1% in FY24, compared to 26.7% in FY23.

ESG & CSR

Being a responsible organisation, ESG is an integral part of our operations. We are excited by the groundbreaking work being done by the 360 ONE Foundation. Over the last few years, we have transformed traditional grant-giving to a catalytic approach towards CSR, leveraging outcome-based and blended financing to unlock additional pools of capital and drive exponential impact for the end beneficiaries. We look forward to sharing more about the Foundation's work over the year. Since 2022, we have positively impacted more than 140,000 lives through our CSR program. 32% of employees in the organisation are women, while we have a 90% retention rate among employees who have availed of parental leave.

32% of employees in the organisation are women, while we have a 90% retention rate among employees who have availed of parental leave

The BRSR report for FY24 reflects our organisation's efforts to pursue sustainability and our endeavour to uphold and integrate environmental, social, and governance (ESG) principles into the company's operations. Let me share a few achievements of FY24:

• Around 98% of clients in FY24 were onboarded digitally, saving paper and trees.

• We successfully maintained our gender diversity ratio at 32%.

• Over 86% of employees received upskilling training during FY 2023-24.

• ESG risk was included in the company's risk management policy.

• There were zero environmental non-compliance, corruption, bribery, conflict of interest, and data privacy breaches.

Empowering Wealth Creation

At 360 ONE, our unwavering commitment to personalised attention, independence, and expertise ensures we deliver the best advice and service tailored to your unique goals.

The asset management industry in India, encompassing both mutual funds and alternates, has experienced substantial growth, with total assets under management increasing from 26 tn to 58.9 tn over the past five years ². This expansion is attributed to rising incomes, improved financial literacy, and favourable regulations. Within this sector, alternates, including Alternative Investment Funds, Infrastructure Investment Trusts, and Real Estate Investment Trusts, have seen notable growth over the same period. AIFs serve as vehicles for private and public alternatives, such as Portfolio Management Services (PMS), and specific AIFs investing in public markets, aiming to achieve higher returns through strategically selecting publicly traded instruments.

Our unwavering commitment to personalised attention, independence, and expertise ensures we deliver the best advice and service tailored to your unique goals

Interestingly, the mutual fund industry in India has witnessed a shift, with rising contributions from B-30 cities areas beyond the top 30 metro regions. B-30 cities have contributed about 10 tn, or 18%, of the total 50 tn AUM in the MF industry, and the increasing equity investment penetration from these cities indicates a growing interest in financial markets within these regions³.

The availability of diverse financial products in private and public markets empowers India's populace to actively participate in the ongoing wealth creation cycle. From traditional avenues like mutual funds and government bonds to more sophisticated options such as private equity and venture capital funds, individuals now have a wide array of investment opportunities, making it easier to capitalise on the potential opportunity at hand.

Consolidated for Growth

We are proud of what we have accomplished this year but recognise that there is always room for growth. Our commitment to continuous improvement is unwavering as we set even higher goals for the future. To our cherished stakeholders employees, partners, clients, and communities thank you for being an integral part of this remarkable journey. Your support has brought us here, and we will continue to achieve even greater things together.

With a focus on growth and being future-ready, we are poised to embrace new opportunities and challenges. Together, we will shape a brighter, more prosperous future.

Thank you,