Angel One zooms 7% on robust Q4 earnings, Motilal Oswal bullish on distribution segment

Shares of Angel One Ltd gained over 7 percent on April 18, a day after the company reported a 27.3 percent on-year (YoY) growth in net profit at Rs 340 crore for the quarter ended March 31. The company’s revenue from operations soared 64.3 percent over last year to Rs 1,357.2 crore.

Angel One is undertaking a change in its business model, which will incrementally drive the focus towards gaining market share in the cash segment, along with strong growth in distribution revenues, over the next 2-3 years. Growth in the distribution segment will be driven by loans, insurance and a few other products, according to Motilal Oswal.

At the operating level, Angel One’s earnings before interest, tax, depreciation, and amortisation (EBITDA) increased 37.2 percent to Rs 529.7 crore in the fourth quarter, while EBITDA margin stood at 39 percent compared to 46.7 percent in the corresponding period of FY23.

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The brokerage firm’s management continues to invest in technology to strengthen its position.

Angel One’s total expenses rose around 92 percent with its net profit margin falling to 25 percent. The company has been spending more on client acquisition and technological upgrades as it battles rising competition from online brokers such as Zerodha, Groww and Upstox.

Angel One held a 14.7 percent share of demat accounts in India in the Jan-March compared with 12 percent a year earlier.

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At 9:17am, the Angel One shares were trading 7 percent higher at Rs 3,070.60 on the National Stock Exchange (NSE). In the last one year, the stock has delivered multi-bagger returns of over 135 percent, outperforming benchmark Nifty 50’s 26 percent rise in this period.

In comparison, the Nifty Financial Services index has risen around 13 percent.

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