Angel One shares down 7% to 5-month low after Q3 earnings miss
A leading retail full-service broking firm in India namely Angel One saw its shares drop by as much as 7% in the early morning of Tuesday later followed by this Wednesday, January 14 to touch a terminal of ₹2,275. This was attributed to the MCS company’s Q3FY25 results downing analyst’s forecast and sliding downwards.
Q3FY25 Performance Highlights
Angel One posted a net profit of 8.1% YoY in consolidated basis at ₹281.4 crore in the December quarter from ₹260.4 crore a year ago. Nevertheless, this was the smallest quarterly profit rise since its IPO in 2020 though the derivatives segment was impacted by rigourous regulations.
, successively, net profit declined dramatically from ₹423 crore in the quarter ended September. Total operating revenue increased 19.2% YoY at ₹1,262.2 crore against ₹1,059 crore in the corresponding period last year.
Operational Metrics
EBITDA expanded by 24.7 per cent YoY to ₹496 crore for the third quarter of FY25 against ₹397.8 crore during the same period last year. Operating profit margin however was flat YoY at 39%; however it declined by 500 basis points QoQ.
Impact of SEBI Regulations
SEBI which has been actively implementing new measures in the Indian equities market recently tightened regulations in equity derivatives in October through which barriers to entry for trading in equity derivatives were raised and the costs of trading in the segment were made considerably higher. This was intended to address the phenomena of burgeoning retail participation in derivatives trading, resulting in a periodical effect across the industry.
Dinesh Thakkar, Chairman and Managing Director of Angel One, commented:
“Although several regulations adopted this quarter led to a temporary effect across the industry, increased CL acquisition strategy bolstered by the general restoration of idled clients’ activities will enhance the industry’s growth in the subsequent quarters.”
In order to partly offset these regulations, during the quarter, Angel One had increased its brokerage charges including option & future charges.
Interim Dividend Declaration
The board of the company declared its first interim dividend for the year FY25 at ₹11 per share on each equity share of ₹10/- face value aggregates ₹99.3 crore.
Key Metrics for Angel One
- Average Daily Turnover (ADTO): On an actual disbursal basis, Angel One’s ADTO for Q3FY25 was down by 11.8% QoQ to ₹40 trillion from ₹45.4 trillion reported during the previous quarter.
- Client Base: The company attracted 2.1m new clients in the quarter although it want down to 30.3% QoQ. The total number of the clients increased to 29.5 million, which constituted 7.4% increase on the QoQ basis.
- Margins: The brokerage’s margin for the December quarter was 39.3 percent same as 37.6 percent in the same period of previous year.
Stock Performance
The stock price of Angel One has eroded by 22% in January 2025 and it is now 41.35% off its apex price of ₹3,896 in January 2024. The stock produced a negative return by 16% as of CY24 end.
Nevertheless, the correction here is rather fresh – and even after that, the stock has some magnificent of multiple bagger of 661% gain over the last five years only.
Also Read: HCL Technologies Live Share Price Updates, 14 Jan 2025: HCL Technologies in Focus
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