Buy ANGEL One; target of Rs 2050: Motilal Oswal

Motilal Oswal's research report on ANGEL One

ANGELONE’s net revenue grew 24% YoY, but declined 2% QoQ to INR5.2b (6% lower than our estimate) in 1QFY24, primarily led by a miss in the number of orders for the F&O segment. Number of orders at 249m was lower than our estimates. Gross broking business grew 18% YoY, driven by the F&O segment, which saw a strong growth of 23% YoY, but declined 7% QoQ to INR4.7b. Cash broking revenue declined 15% YoY, but jumped 20% QoQ to INR558m. Interest income grew 6% YoY and 20% QoQ to INR 1.5b. MTF book stood at INR11.4b in 1QFY24 vs. INR11.5b in 4QFY23. CI ratio increased significantly at 51.4% (vs. our estimate of 47.4%), a surge of 890bp sequentially. Expenses were broadly in line with our estimates. QoQ surge was on account of INR300m reversal of employee expenses pertaining to lapsed ESOPs in 4Q.

Outlook

We reiterate our BUY rating on the stock with a revised TP of INR2,050 (premised on 14x Mar’25E EPS).

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