JM Financial has a price target of ₹2,700, which implies a potential upside of nearly 18% from Friday’s close.
Angel One is among the largest retail brokers in India, serving over 32 million clients, of which more than 9 million are active on the NSE, JM Financial wrote in its note.
Founded in 1996 as a traditional offline broker, the company pivoted to online discount broking in FY20, delivering rapid growth across key metrics. Between FY20 and FY24, its client base expanded at a 68% CAGR, net revenue grew at 80% CAGR, and profit after tax (PAT) at 90% CAGR.
From FY24 onwards, Angel One has been diversifying into adjacent businesses such as wealth management, asset management, loan origination, and life insurance, even as regulatory changes reshaped the derivatives segment.
The brokerage said that despite tighter norms around derivatives, such as upstreaming client funds, stricter labeling of charges, and fewer expiry days, the industry has become more transparent and Angel One managed to maintain FY25 PAT at FY24 levels while investing in its new business lines.
JM Financial observed that although new client acquisition and revenue trends have been volatile, long-standing (vintage) clients continue to contribute steady income. In FY25, nearly 39% of net revenue came from clients acquired in FY24-FY25.
With a stronger focus on farming its existing client base, Angel One’s revenue mix is expected to become more recurring and stable, setting the stage for long-term growth once client acquisition costs normalise.
However, the brokerage cautioned that Angel One’s deliberate slowdown in client acquisition during FY25 and the first half of FY26, coupled with investments in adjacent businesses, is likely to result in a 15% decline in PAT in FY26 compared to FY25. A recovery is expected from FY27 onwards, as the company benefits from a recurring revenue base and resumes growth.
JM Financial expects the stock to re-rate gradually as the company transitions from a largely transactional model to a recurring-revenue model.
Shares of Angel One Ltd. ended Friday’s session at ₹2,297, taking the total gains made by the stock in the last six months to over 12%.
