A soaring high Angel

The world of stock trading has transformed tremendously in recent years. Thanks to technological advancements and ease of payment, one can trade in the stock market at the click of a button. A SEBI report in January 2023 stated that the number of individual traders engaging in F&O (Futures and Options) - complex financial instruments - has skyrocketed, increasing almost seven times from around seven lakh in FY19. This surge not only reflects the growing interest in stock trading but also the democratisation of access to financial markets. Apart from traders, this transformation has also benefited discount brokers. They facilitate transactions between traders and the stock exchange at a fee (or brokerage). Thanks to technology (simplified user experience, cloud computing, ease in digital onboarding), these brokers have seen hassle-free client acquisition. One standout example is Angel One , a listed discount broker that has seen its value increase more than elevenfold since its debut in October 2020. What has fueled Angel One's impressive growth? Let's find out. The realisation of a digital revolution early on Angel One recognised the potential of digital trading over traditional calling-over-the-phone operations early. By 2019, it had zero branches (180 earlier) and completely digitised processes. This increased Angel One's revenue per employee by more than four times and operating profit margin by over 11 percentage points from FY18 to FY23. The ROCE has increased from 13 per cent in FY19 to 45 per cent in FY23. Moreover, its client acquisition run rate improved from a monthly average of nearly 22,000 in FY19 to nearly 4,00,000 in FY23. Angel One's robust financials The PAT grew at 67 per cent per annum in the last three years TTM Q3 FY24 TTM Q3 FY23 TTM Q3 FY22 TTM Q3 FY21 Revenue 3740 2857 1996 1048 Operating profit 1504 1177 729 320 Operating profit margin (%) 40.2 41.2 36.5 30.5 Net profit 1053 828 522 226 Net profit margin (%) 28.2 29 26.2