HDFC Securities FY26 Results: PAT Falls 17% to ₹929 Cr — What It Means for Unlisted Share Investors
A tough year for India's broking industry — but Q4 shows the cycle may be turning. Here is every number, every risk, and the forward view every unlisted investor needs.
FY 26 PAT : ₹929 CR
Q4 PAT (BEST QTR) : ₹268 CR
Unlisted Price : ₹9,000
Trailing P/E : ~17x
Mkt Cap (Unlisted) : ₹ 16,000CR
HDFC Securities Limited —
The stock broking and financial distribution subsidiary of HDFC Bank — just published its audited standalone and consolidated financial results for the year ended 31 March 2026. The results were approved by the Board on April 13, 2026, and filed with NSE under SEBI (LODR) Regulations. Statutory auditors S.R. Batliboi & Co. LLP issued a clean, unqualified opinion.
The headline numbers reflect a cyclical reality facing the entire Indian broking industry: strong underlying fundamentals, but a meaningful earnings dip driven by SEBI's derivatives regulations and softer trading volumes. Here is everything you need to know — from the numbers, to the Q4 recovery, to what comes next.
The FY26 Numbers at a Glance (Standalone)
| Metric | FY25 | FY26 | Change |
| Revenue from Operations | ₹4,006 Cr | ₹3,715 Cr | ↓ 7.3% |
| Profit Before Tax | ₹1,494 Cr | ₹1,253 Cr | ↓ 16.1% |
| PAT (Full Year) | ₹1,125 Cr | ₹929–930 Cr | ↓ 17% |
| Q4 Revenue | ₹742 Cr | ₹850 Cr | ↑ 14.5% |
| Q4 PAT | ₹251 Cr | ₹268 Cr | ↑ 6.8% YoY / ↑ 22% QoQ |
| Basic EPS (Q4) | ₹122.9 | ₹150.3 | ↑ 22.3% |
| Net Margin | ~28% | ~25% | Compressed |
Q4 Recovery: The Signal Investors Were Waiting For
The full-year PAT decline of 17% grabs the headline, but the quarterly trajectory tells a more important story — one of recovery, not decline. Q4 FY26 was the strongest quarter of the year by PAT, and it marked the second consecutive quarter of sequential improvement.
Q1 FY26 ₹215 Crore PAT
Q2 FY26 ₹226 Crore PAT
Q3 FY26 ₹220 Crore PAT
Q4 FY26 ₹268 Crore PAT (Best Quarter )
Why Q4 matters:
Q4 revenue jumped 14.5% YoY to ₹850 Cr and PAT grew 22% sequentially from Q3's ₹219 Cr. This is not a coincidence — it reflects a genuine rebound in retail trading volumes and fees and commission income rising to ₹420.5 Cr in Q4 vs ₹387.4 Cr in Q4 FY25, signalling recovery in activity. The floor may well be in.
Employee Cost Spike: A One-Time Hit, Not a Trend
Employee benefit expenses rose sharply from ₹480 Cr in FY25 to ₹575 Cr in FY26 — a 19.8% jump that alarmed many analysts. But here is the critical context the headline misses: this included a one-time ₹103.7 Cr provision for past service cost on gratuity, triggered by the new Labour Codes notified by the Ministry of Labour and Employment in November 2025.
Forward implication:
Strip out the one-timer and FY26 employee costs were broadly flat YoY. This means FY27 employee costs should normalize, making forward earnings look significantly better than the FY26 base implies. Investors pricing in a permanent cost increase are likely wrong.
FY27 Forward Earnings Estimate: The Recovery Case
With Q4's trajectory now visible and the one-time employee cost out of the way, a reasonable FY27 recovery scenario can be built. This is what unlisted investors are actually buying into.
| Scenario | FY27 PAT | At ₹9,000/Share | Forward P/E | Implied Fair Value |
| Bear (volumes stay soft) | ₹950–980 Cr | ~₹16,000 Cr mkt cap | ~16.5x | ₹8,500–9,500 |
| Base (Q4 run-rate holds) | ₹1,050–1,100 Cr | ~₹16,000 Cr mkt cap | ~14.5x | ₹10,500–12,000 |
| Bull (listing + volume recovery) | ₹1,150–1,200 Cr | ~₹16,000 Cr mkt cap | ~13.5x | ₹13,000–15,000 |
The base case assumes Q4's quarterly PAT of ₹268 Cr annualises toward ₹1,070 Cr, driven by normalising employee costs, recovering F&O and cash volumes, and continued MTF book growth. At ₹9,000 per share, that implies a forward P/E of ~14.5x — compelling relative to listed peers at 35–70x, even after accounting for the illiquidity discount.
Revenue Deep-Dive and the Lending Shift
The income statement tells a nuanced story. Interest Income grew from ₹1,418 Cr to ₹1,498 Cr (+5.6%), reflecting rapid scaling of the Margin Trading Facility (MTF) book. Fees and Commission Income fell from ₹1,744 Cr to ₹1,516 Cr (–13.1%), directly reflecting SEBI's F&O regulations.
This divergence is structural. HDFC Securities is becoming a more lending-oriented, less brokerage-dependent business — a shift accelerating across the industry. It also now runs a GIFT City subsidiary (HDFC Securities IFSC Limited, incorporated October 2024), adding optionality for offshore flows.
Why the Entire Industry Had a Tough FY26
HDFC Securities' earnings decline did not happen in isolation. The entire cohort of Indian capital market businesses had a painful year, driven by five compounding factors.
SEBI's October 2024 F&O Regulations: Starting 1 October 2024, SEBI reduced weekly index options expiry dates to one per exchange per week, raised minimum contract sizes, tightened margins, and mandated "true-to-label" fee structures. Average daily equity derivatives turnover on NSE fell approximately 27% in the six months that followed.
Listed broker earnings collapsed across the board: Angel One reported a 50% YoY PAT fall in Q2 FY26. IIFL Capital, 5paisa, and Motilal Oswal all reported 35–61% profit declines. HDFC Securities' 17% annual decline — painful as it is — actually shows the resilience of its diversified revenue base relative to pure-play discount brokers.
Market correction and IPO slowdown: The broader equity market corrected from September 2024 peaks, reducing IPO pipeline, equity trading activity, and mutual fund commissions simultaneously. Q4's volume recovery suggests stabilisation.
Key Risks Every Unlisted Investor Must Know
01 No IPO Timeline
HDFC Securities has not announced any listing plans. Without a catalyst, the path to realising the valuation gap with listed peers is uncertain and could take years.
02 Regulatory Overhang
Further SEBI tightening on F&O, MTF, or distribution commissions remains a real risk. SEBI has been on an active regulatory drive with no certainty it stops here.
03 Rising Leverage (4.2x D/E)
The CP book matures through June 2026. Any credit market tightening or rate rise could force the company to shrink its lending book quickly — compressing interest income.
04 Unlisted Iiquidity
Unlike Angel One on NSE, exits in unlisted shares can take time, bid-ask spreads are wide, and pricing is opaque. Not suitable for short investment horizons.
05 Parent Dependency
HDFC Securities' moat is partly its HDFC Bank parentage. Any change in strategic priority at the parent level could materially impact the standalone entity.
06 CP Refinancing Risk
₹12,931 Cr in commercial papers outstanding — nearly double FY25. Interest rates between 7.25–7.90%. A credit crunch or rate spike could squeeze margins on the MTF book.
Disclaimer:
This is written for educational and informational purposes only. Nothing here constitutes investment advice or a recommendation to buy or sell securities. All data is sourced from publicly available information as of April 2026. Investments in securities markets are subject to market risks — please read all offer documents carefully before investing.
