Angel One stock declines 10% on SEBI's revision in market intermediary charge mechanism

The news also tipped off a meteoric spike in volumes in the counter as 18 lakh shares changed hands on the exchanges so far.

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26 Aug, 2025 12:21

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Shares of Angel One fell as much as 10 percent on July 2 following the Securities and Exchanges Board of India's (SEBI) new circular that revised market intermediary charge mechanism.

At 09.59 am, shares of Angel One were trading at Rs 2,394.85 apiece on the NSE. The news also tipped off a massive spike in volumes in the counter as 18 lakh shares changed hands on the exchanges so far, significantly higher than the one-month daily traded average of five lakh shares.

SEBI's new circular stated that Market Infrastructure Institutions (MIIs) like stock exchanges and clearing corporations should not give discounts based on turnovers.

Currently, MIIs such as exchanges and depositories levy transaction charges and depository fees on brokers using a slab-wise structure. Brokers, in turn, charge their customers using a similar slab-wise structure.

However, the timing of these charges differs as brokers generally recover these charges from end clients on a daily basis, while MIIs receive the aggregate charges from members on a monthly basis. Consequently, the total charges collected by brokers from end clients are higher than the charges paid to MIIs at the end of the month due to the slab benefit.

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Accordingly, discount brokers currently earn between 15 percent and 30 percent via transaction charge discounts, while for deep discount brokers, that number rises further to 50 percent to 70 percent.

However, the revised circular states that the MII charges, which are to be recovered from the end client, should be “true to label,” meaning that if any MII charge is levied on the end client by members (stockbrokers, depository participants, clearing members), MIIs should ensure that they receive the same amount.

As per the circular, the charge structure of MIIs should be uniform and equal for all members instead of the slab-wise structure which is dependent on volume/activity of members.

Based on these changes, Motilal Oswal Financial Services feels that discount brokers’ revenues may be hit as they earn a significant share of their
revenues from such charges with their large base of retail customers and hence lower volume/ticket size. Angel One earned about Rs 4oo crore from these charges in FY24.

Despite that, the brokerage also feels that the impact of these charges can still be offset by higher brokerage rates.

Also Read | HDFC Securities maintains add rating on Angle One; cuts target price to Rs 2,750 a share

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