Hem Securities IPO report on Angel Broking
Company is one of the largest retail broking houses in India in terms of active clients on NSE as of June 30, 2020.Company is a technology-led financial services company providing broking and advisory services, margin funding, loans against shares through one of Subsidiaries, AFPL and financial products distribution to its clients under the brand “Angel Broking”. Company’s online and digital platforms, along with its vast network of Authorised Persons enables to reach a large population of retail clients spread across approximately 96.87% or 18,649 pin codes in India. This widespread reach has enabled company to enhance its client base by 36.81% CAGR from 1.06 million in FY18 to 2.15 million as on June 30, 2020. Over this period, company witnessed a consistent growth in its gross client addition of 0.22 million, 0.26 million, 0.56 million and 0.35 million in FY18, FY19, FY20 and Q1 FY21, respectively and representing a 59.54% CAGR over the period from FY18 to FY20. In the three months period ending June 30, 2020, company witnessed an average monthly client addition of approximately 115,565 clients, over a monthly average of 46,676 clients in FY20 representing a growth of 147.59%. Over the last one year, company have more than doubled its overall turnover market share in the retail broking space in India. Company is bringing the issue at p/e multiple of approx 29x at higher end of price band of Rs 305-306/share on post issue FY20 eps basis.
Valuation and Outlook
Company being one of the largest retail broking houses has strong client base through its online & digital platform & authorized persons network.Company has significant market share in cash & commodity segment with track record of continuous growth & strong financial performance. Therefore, looking after all, we recommend “Long Term Subscribe” on the issue.
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