Complete SWOT Analysis of Motilal Oswal Financial Services – An Indian Financial Services Company

Quick Stats on Motilal Oswal Financial Services

Founder	Motilal Oswal
Year Founded	1987
Origin	United Kingdom
No. of Employees	3,800+
Company Type	Public
Market Cap	Rs 13,151.65 Crore (2022)
Annual Revenue	N/A
Net Income/ Profit	Rs 712.40 Crore (2021)

 

Services By Motilal Oswal Financial Services

• Broking
• Mutual Funds
• Wealth management

Competitors of Motilal Oswal Financial Services

• Certent Equity Compensation Management
• Carta
• Pulley
• Vestd
• Shareworks by Morgan Stanley

After understanding the core of the corporation, let us now proceed to the SWOT analysis of Motilal Oswal Financial Services. 

SWOT Analysis of Motilal Oswal Financial Services

Motilal Oswal Financial Services is a part of Bajaj Holdings & Investments Limited, an Indian financial services company focused on lending, asset management, wealth management, and insurance in the Indian financial ecosystem. We shall do a thorough SWOT Analysis of Motilal Oswal Financial Services to gain insights into the company’s strengths, weaknesses, opportunities, and threats. 

To better understand the SWOT analysis of Motilal Oswal Financial Services, refer to the infographic below:

Let’s proceed further with expanding on the strengths of the Motilal Oswal Financial Services from the SWOT analysis of Motilal Oswal Financial Services

Strengths of Motilal Oswal Financial Services

Strengths express what an organization excels at doing and what differentiates it from the competition: a strong brand, loyal customer base, a strong balance sheet, unique technology, and so on. Motilal Oswal Financial Services must then decide on how to use those outcomes to attract emerging investors.

• Large Range of Financial Products: One of the strengths of Motilal Oswal Financial Services is its ability to offer a wide range of financial services to its massive customer base. Securities and investments were created to provide its customer base with short-term or long-term financial gains.
• High Revenue Turnover: Motilal Oswal Financial Services has had a steady increase over the years in revenue even during and after the advent of Covid 19. Revenue is upheld by an enormous extent of good management structure, marketing strategies, solid financial product development, and cost-cutting techniques. 
• Solid Capital Structure: Maintaining a growing capital structure is one of the base objectives of a business that Motilal Oswal Financial Services is upholding. In the course of the last five fiscal years, the gathering has raised Rs 14908 crores of value which has fundamentally expanded the net worth of the organization.
• High Returns on Investment (ROI): Over the past five years now, Motilal Oswal Financial Services has been giving its shareholders high returns on investments through its stocks traded on the exchange Year on Year(YoY). 
• Quality Financial Services: Another strength of Motilal Oswal Financial Services is that its customers get quick services and this is one of the unique strengths of Motilal Oswal Financial Services which provides the customers with one-stop-shop financial offers in three minutes which has now reduced to 3 seconds.
• Financial Growth: MOFS is expecting 50% financial growth from sectors including IT, oil and gas which will contribute about 30-40% growth in the coming quarter. Motilal Oswal Financial Services will be a big show to watch out for in the Q4 earnings season.

Weaknesses of Motilal Oswal Financial Services

Weaknesses limit an organization from achieving its ideal level. To remain competitive they are part of the business that needs improvement: for example, a weak brand, higher average turnover, high levels of debt, an inadequate supply chain, or lack of capital.

• Decreased Mutual Funds Holdings: The mutual funds holding of Motilal Oswal Financial Services has dropped drastically in the past quarters. Mutual funds diminished their shareholding last quarter, a decline in net profit with falling profit margin quarter on quarter(QoQ), companies with high gearing ratio, companies with weak financials.
• Non-Performing Assets of Motilal Oswal Financial Services: The major setback of the financial service sector is NPAs (Non-Performing Assets). Typically, NPAs denote loans that are not recoverable. This inevitably leads to financial losses for Motilal Oswal Financial Services. 
• Lack of Coverage in Rural Areas of Financial Products: It has been revealed that the financial service industry focuses more on urban areas in most countries, while rural regions are ignored. In the banking sector, this is a considerable weakness.

Opportunities for Motilal Oswal Financial Services

Opportunities refer to favourable external components that could give an organization a competitive edge. For example, if a country cuts tariffs, increasing sales and market share.

• Global Opportunities: A major opportunity for financial service players in the Indian market is the global financial service market, it is inarguably that the global market is worth billions of dollars. Motilal Oswal Financial Services is mainly focused on the Indian market, so it needs to increase its reach outside the Indian market as well making it gain more customers.
• Rise in the Private Banking Sector Globally: The financial service industry around the world is highly regulated by the public sector authorities and their respective central banks. With the emergence of private sector banks, this sector is experiencing structural and functional shifts, primarily due to the adaptation of new technology and intensified competition, thereby benefiting end customers.
• Advancements in Technology in the Banking Sector: The banking industry has always functioned based on technology. This is evident that digital services provided by banks today are based on technology. Thus, banks should continue to adopt the latest technological advances. To draw future generations, they should focus on putting out newer banking and financial service using digital marketing skills.

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Threats to Motilal Oswal Financial Services

Threats refer to components that have the potential to damage an organization. For example, unfavourable government policies, and a drastic decline in revenue. Other common threats include things like rising costs for materials, increasing competition, tight labour supply, and so on.

• Government Policies: Government regulations can directly affect the banking sector of a country, these government policies might be unfavourable for Motilal Oswal Financial Services. 
• Global Uncertainty in the Financial Ecosystem: The world is going through difficult economic times at the moment. The international banking sector has all been affected by trade wars, protectionist policies, and economic downturns. If the world’s economic conditions do not change, the financial service industry will face a bleak future.
• Lack of Proper Cyber Security Systems: The current banking industry relies entirely on the cyber-world. Whether it is data storage, monetary transactions, or personal information, everything is stored digitally. This makes the banking sector a primary target for hackers who are seeking to benefit financially by leveraging flaws in the bank’s digital infrastructure. Banks need to take effective cybersecurity steps to safeguard their records, they will face a significant cyberspace threat.

This ends our study on the SWOT analysis of Motilal Oswal Financial Services. Let us conclude our learning below.