Shift from 2012 to 2014

 ANGEL BROKING IPO

(ZEE BUSINESS)

BASIC DETAILS ABOUT IPO  (22-24September)
Price Band	305-306
Bid Lot	49 shares
OFS (Amount)- AT  Upper Band	300cr
OFS (Shares)-  Cr	0.98
Fresh Issue- AT  Upper Band	300cr
Fresh Issue (Shares)-Cr	0.98
Total issue amount- AT Upper Band	600cr
Post issue Implied Market Cap	2503cr
Post issue (Shares)Cr	8.17989
Book Running Lead Manager: ICICI securities, Edelweiss, SBI Capital Market & LINK Intime

BASIC FINANCIALS (P&L)
(Amount in cr)	FY20	FY19	FY18
Revenue	724.6	758.0	764.3
Growth	-4.4%	-0.8%	-
EBIT Margin	31.8%	31.9%	32.2%
PAT (Ex- Other Income)	64.8	66.4	99.0
Growth	-2.4%	-32.9%	-
PAT Margin(Ex- Other Income)	8.9%	8.8%	13.0%
PAT	86.8	83.4	109.8
PAT Margin	11.9%	11.0%	14.4%
Other income % of revenue	4.1%	3.4%	2.1%
Fees and Commission expense as % of Revenue	31.8%	31.9%	32.2%

 

 

Segmental Information
(in cr)- Revenue from	FY20	FY19	FY18
Interest Income	157.7	202.4	236.9
% of Total Revenue	21.8%	26.7%	31.0%
Fees and Commission Income	564.4	555.6	526.6
% of Total Revenue	77.9%	73.3%	68.9%
Net Gain on Fair Value Changes	2.5	0.07	0.8
% of Total Revenue	0.3%	0.0%	0.1%
Total	724.6	758.0	764.2

BASIC FINANCIALS (Balance sheet & Cash Flows)
(Amount in cr)	FY20	FY19	FY18
Cash and Bank Freely available	367.8	310.6	98.7
% of Total assets	16.8%	14.1%	4.1%
Total Cash and Bank	1413.6	986.0	944.7
% of Total Assets	64.5%	44.6%	39.7%
Loans	280.6	761.7	1092.4
% of Total Assets	12.8%	34.5%	45.9%
Borrowings	490.9	871.9	1137.4
% Growth	-43.7%	-23.4%
FCF	630.7	697.2	-290.4
FCF/PAT	7.7	8.7	-

 

 

 

 

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PEER COMPARISION

 

Name of Company
	EPS Diluted*	Total income FY20(Cr)	NAV	PE TTM	RONW
Angel Broking Ltd	11.44	754.7	82.2	26.7	13.9
ICICI Securities	16.8	1722.0	37.5	28.4	44.3
Geojit	2.0	306.4	23.8	19.4	8.9
IIFL Securities	7.3	790.1	27.5	5.7	26.4
MotilalOswal	12.2	236.5	210.9	56.0	4.2
JM Financial	6.5	3453.6	96.7	12.6	9.7

*Diluted EPS for the year ending 31 March 2020.

**PE has been calculated based on Market Price as on 31^st August 2020

 

 

 

 

HOLDING:

Particular	Pre-Issue	Post-Issue
Promoter	55.2%	47.67%
Public	44.8%	52.33%
Total	100.0%	100.0%

 

 

PRO’s

·         Equity market is gaining attraction and we have seen many new trader/Investor coming to market and still India’s penetration is low so huge potential remain to be unfolded.

·         Company’s Rank based on monthly incremental active clients improved from 6 in April-18 to Mar-19 to 2 in April20 to June 20 and it has structured its Brokerage rate structure similar to the largest player Zerodha which has helped in gaining clients.

·         Companies market share in ADTO(Average daily turnover) rose from 3.24% in 2018 to 5.41% in 2020 and has been showing improvement in each month as in April 2020,May 2020, June 2020 market share was 6.83%, 7.56%, 9.55% respectively or for Q1FY21 came at 8.23%.

·         As Company works on Asset Light Model it is able to generate good cash flows and hence have reduced its debt from 1137.4cr as on 31 March 2018 to 658.0cr as on 658.0 i.e. reduced by 42.2%

·         Although companies Top line saw continuous pressure from FY18 to FY120 also PAT followed more or less similar Trend but companies Q1FY21 Revenue and PAT showed a swift uptick Q1FY21 revenue already 33% of Total FY20 Revenue and 55.7% of Total PAT for FY20.

·         Valuation based on PE based on FY20 comes at 26.7 which seems fairly valued but Q1FY21 quarter company did exceptionally well and PE TTM comes to around 20.2 which seems slightly attractive.

 

Name of Company
	PE	PE TTM
Angel Broking Ltd	26.7	20.2
ICICI Securities	28.4	24.3
Geojit	19.4	12.9
IIFL Securities	5.7	8.9
MotilalOswal	56.0	31.0
JM Financial	12.6	10.5

 

 

 

 

 

 

 

 

 

CON’s

·         Market share comes at a cost of offering competitive lower brokerage fees hence we saw even though volume rose Revenue from brokerage could not show significant jump.

·         Company operates in highly competitive business were a threat from new player can cause a significant disruption in Industry which reduces faith for long term.