DAM Capital bets on earnings stability

India’s only listed pure-play investment bank, DAM Capital Advisors Ltd, plans to deploy its capital reserves into recurring, fee-based businesses to reduce the inherent volatility of investment banking, managing director and chief executive Dharmesh Mehta told Mint.

- Agnidev Bhattacharyya [e-mail]

The firm will use cash reserves to build fee-based businesses: MD and CEO Dharmesh Mehta

While merchant banking remains the firm’s primary earnings driver, DAM Capital is evaluating asset-light ancillary services that require minimal capital deployment and limited balance-sheet risk to diversify its revenue base.

The Mumbai-based investment bank reported a cash balance of ₹287 crore as of the first half of the 2025-26 fiscal year. “A portion of this is required as working capital for the institutional equities business, but a part of it is also dry powder for potential ventures into businesses like alternative investment funds (AIFs), retail broking, and wealth management,” Mehta said.

“We will look at everything that generates fees without large cash burn or high balance-sheet risk. Wealth management today is a valuation-driven segment, not profits. For a new entrant, it requires significant upfront investment. We will build these businesses when we get the right team or the right platform at reasonable valuations.”