Angel One Limited (formerly Angel Broking) is a leading technology-driven financial services company in India, offering a wide range of products including equity broking, commodity trading, mutual funds, insurance, wealth management, and lending services. The company operates under a digital-first, low-cost brokerage model, catering primarily to retail investors with a strong focus on Tier 2 and Tier 3 cities.
In this article, we will discuss the summary of the management commentary from the Q3 FY25 earnings conference call held on January 14, 2025.
Market and Regulatory Environment
India’s capital markets are on the remarkable growth path driven by a surge in demat account additions.
Enhanced transparency through regular regulatory updates has cultivated trust, fuelling steady increase in participation and trading volume across the industry.
The regulator made such an update to cultivate trust, as Q3 FY ’25 reflects the implementation of the True to label framework, standardizing exchange charges with a flat fee structure regardless of turnover.
- To adapt, we took proactive steps introducing flat fee brokerage for cash delivery orders and implementing interest charges on disproportionate non-cash collateral exceeding ₹ 50,000 from mid-November 2024.
In Q3, the industry also saw implementation of first phase of the measures to strengthen equity index derivative framework for increased investor protection and market stability.
The company estimated a short-term impact of 13% to 14% on total net income due to these changes for the period of implementation till client behaviour adjustment, apart from market-driven softer volumes as evident since October 2024.
Additional regulatory update on grouping monthly expiry for each of the exchange, 2 exchanges to 1 day of the week, would bring an additional 3% to 4% decline.
Significant milestones during the Quarter
- The company started rolling out the beta launch of insurance journey within the SuperApp.
- The company also launched the wealth management brand ‘Ionic Wealth’.
- The company’s assisted business channel also scaled up the mutual fund distributor network, contributing to a growing mutual fund AUM. Based on behavioural insights, the company refined client engagement through improved discovery on the app.
- To help company’s high-quality business partners further expand their customer base, the company has piloted super local activity that leverage targeted localized insights and tools. This strategy helps bridge the gap between digital convenience and personalize community focus interactions.
- Operationally, company has achieved healthy results despite headwinds adding 2.1 million clients with 88% coming from Tier 2 and Tier 3 and beyond cities. Its consistent focus on growing market share is evident with 26 basis points sequential expansion in its share across India’s total demat account to 15.9% as of December 2024.
- Company’s retail equity turnover market share expanded by 41 basis points to 19.7% in Q3 FY ’25.
Financial Performance Summary
| Metric | Q3 FY25 | QoQ Change | 9M FY25 | YoY Change |
|---|---|---|---|---|
| Gross Revenue | ₹12.6 billion | ▼16.6% | ₹41.9 billion | ▲43.4% |
| Broking Revenue | ₹8.2 billion (65% of total) | ▼12.5% | – | – |
| Interest Income | ₹3.5 billion | ▼2.8% | – | – |
| Depository Income | ₹0.55 billion | ▼24% | – | – |
| Distribution Income | ₹0.30 billion | ▲16.9% | – | – |
| EBITDA Margin | 42% | ▼787 bps | – | – |
| PAT (Consolidated) | ₹2.8 billion | ▼33.5% | ₹10 billion | ▲27% |
| Client Funding Book | ₹43.3 billion (end-Q3) | ▲4.2% QoQ | – | – |
| Net Worth | ₹56.3 billion (end-Q3) | – | – | – |
| Annualized ROE | 33.3% | – | – | – |
Key Operational Metrics
| Metric | Q3 FY25 | Growth | Comments |
|---|---|---|---|
| Client Additions | 2.1 million | 40-45% YoY | 88% from Tier 2/3 cities. |
| Demat Market Share | 15.9% (Dec 2024) | ▲26 bps QoQ | Industry-leading retail focus. |
| Retail Equity Turnover Share | 19.7% | ▲41 bps QoQ | Gains despite market slowdown. |
| SIP Registrations | 9 lakh (Dec 2024) | Record high | #2 in incremental SIPs. |
| Credit Disbursements | ₹600 crore (cumulative) | New business | Piloted with 3 lenders; scaling cautiously. |
Progress across Key areas
- In the mutual fund distribution business, the company achieved a major milestone in December 2024 with nearly 9 lakh unique SIP registrations, our highest ever.
- For the past two consecutive quarters, Angelone recorded over 2 million SIPs.
- In digital insurance distribution business, the company took a significant step forward by launching motor insurance on our app. The company has integrated with three insurers and are now live with a select group of clients.
- on credit distribution business over the last two to three years, the personal loan space has grown rapidly but not without challenges. In the industry, there has been higher KYC frauds, over-leverage and delinquencies exceeding expectations. As a result, lenders are now adopting a more cautious, measured approach. While this has led to some short-term growth headwinds, this pause is crucial for building a stronger and more sustainable ecosystem in the long term.
Insights on the AMC
- recently received the regulatory approval to commence our mutual fund operations, a significant milestone in company’s journey to create a trusted brand for passive only products.
- While the ETFs will be distributed through brokers, offering their clients a cost efficient and accessible investment option, Index Funds will come in 2 forms: direct plans and regular plans.
- Direct plans that investors can purchase directly through platforms
- regular plans where we will pay commissions through distributors, ensuring widespread accessibility.
- To help clients fully embrace passive investing, the company is creating educational material to demystify this product and explain their advantages.
Ionic Wealth (Wealth Management)
- Targets underserved “middle belly” segment (mass-affluent, wealthy) with tech-driven, high-touch solutions.
3-Pillar Strategy:
- IQ (Investment Quotient): Domain expertise.
- DQ (Digital Quotient): Tech-powered DIY tools.
- EQ (Emotional Quotient): Personalized advisory.
- To support this, the company has embraced some of the best governing standards. It constituted a world-class Advisory Council, an expert think tank for various asset class views and an internal investment and a product approval committee to guide our product strategies.
- Angleone also launched its Ionic Wealth app in both Play Store and App Store. To start with, it will allow the company to provide real-time access of portfolio performance analytics and assisted client journey.
- In terms of scale, the company has been progressively expanding its geographic footprint with offices now across 7 cities and a dedicated team of about 140 professionals spanning relationship management, investment experts, technology and other support functions.