Angel One has added two times clients in August 2021 against client addition in August 2020: Narayan Gangadhar, CEO

Narayan Gangadhar, CEO, Angel One, talks about the thought process for rebranding Angel Broking to Angel One, plans related to the diversification of the business, transactions in the broking segment, momentum in the market and F&O market among others during an exclusive interview with Deepanshu Bhandari. Edited Excerpts: 

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Q: First tell us about the thought process that led to rebranding from Angel Broking to Angel One?

A: Our journey for rebranding to Angel One reflects our ambition to be one of India’s largest fintech companies. Angle One is a transformation that encompasses a whole smooth of products from broking to fintech services, mutual funds, loans and bonds and we feel Angel One as a company and as a brand is long reflective of our long-term ambitions and our long-term goals of being India’s strongest fintech platform for every Indian. 

Q: After this rebranding is there any additional add on services or diversification that will be seen in Angel Broking and what are your plans related to it?

A: Angel is one of the largest players today in the broking industry. We are currently number three in the total number of accounts opened in the exchange and we are number one in many categories as well such as commodities. Now, we want to continue building on our strength in the broking space. We want to get to the dominating leading position in the broking industry. Once we establish the leadership position then we want to expand out in other sectors because we can offer more services to our customers, to our clients. And these services can range anywhere from mutual funds to insurance to debts and so on. So, this is the path forward for the company as we see it. 

Q: Tell us about the kind of trend that is going on in the broking services because retail participation is increasing in the market and on the other hand discount brokerages is bringing competition. What is the trend of the broking services and what is the contribution of the broking segment in your daily transactions?

A: Broking is one of Angel’s strongest areas, we are the dominant leader in that space and if you look at our numbers in August, we added around 4.5 lakh clients that are more than two times the same number of clients we added in August 2020. So, there has been a dramatic growth in the number of clients that we have added year-on-year. Now, India as a whole remains a highly underpenetrated market. If you will have a look then the penetration in India is only 4% and we predict that compared to countries like China or the US, where the penetration is 11% or 32% there is a lot of room left for growth. Now, our company under the new strategy has onboarded and more than 20 lakh clients in five months alone of FY2, which is around 88% of the 2.4 million clients we added in the entire of FY21. And our customers most of them are millennials, they are coming from Tier-II and Tier-III cities. All of these have resulted in a dramatic growth in our Average Daily Turnover (ADTO), which has increased by 21% quarter-on-quarter to Rs 4.5 trillion. Our market share in equities has expanded to 22%. When we look at the overall business, ultimately, our gross revenue has grown to around Rs 475 crore and our PAT for the previous quarter Q1FY22 has been around Rs 121 crore. So, when you look at this business and our client-centric approach there has been massive growth in this whole space and we are the leaders in this area and we continue to see dramatic growth in this domain. 

Q: If the momentum of the market does not remain like this or there is a slight consolidation phase comes then will there be similar action or what kind of dynamics will be there at that time?

A: Angel has been operating for almost 30 years in this industry and we have seen a lot of these factors. We have seen a lot of economic cycles over the last three decades. These three decades of operational data is telling us that if there is a dip then a coarse correction happens and over a long period of time, the penetration always keeps on increasing. The engagement with the customers always keeps on increasing. So, the way we look at our business is we are here to create lifetime value for our customers. We are investing in building that lifetime value by offering people better value products, by giving them better choice learning platforms and providing better engagement models using our social media platform. So, if the market goes down the next day and even if it ends being cyclical, we still see the engagement continue to grow. And, over a long period of time, we do not see any material impact on our business because as I said we are in the business of long-term value and so are our customers. The customers have become very savvy also. 

Q: There has been an interesting development wherein the F&O market activity has increased a lot, in fact, the activity has increased a lot in options trading. So, what is your situation in the segment and what kind of volumes you are seeing at your end? As far as an overall contribution from this space goes, do you see any benefit from this segment? 

A: Definitely. Angel has always been one of the market leaders in the F&O. If you look at our overall turnover in F&O, it is like 5.5 trillion, which is around 21.8% of the total market. And we also are one of the only brokers who is launching a lot of innovative features to bring more people to this segment. So, we are also market leaders in driving up demand and driving new customer experiences in the F&O space. So, for us, F&O, cash, equity, all are big parts of a larger ecosystem, which is what we are part of. 

Q: From here, what is your outlook for the next six months or a year and what is going to be the key focus or growth potential areas for you?

A: In the next six months to a year, we will continue innovating launching newer features and services for our clients. Our core applications are going to continue to get better and better with time. So, our priority is about building the best-in-class customer experience driven by machine learning, data science and offering new capabilities to our customers, which does not exist in the market. What we are developing is not available in the market, no one has it. So, we want to offer newer and more disruptive experiences to every Indian. We want to democratize. If you still look then in broking the barrier to entry is high. We want to make it so easy that anybody in any part of India can enter the stock market, they can start trading and trade more intelligently. And, we want to be, we are that choice platform for those customers and that is where our focus is going to be over the next year.