Angel Broking Ltd IPO

Angel Broking is aiming to raise additional capital by putting its shares up for subscription by the public via an Initial Public Offering (IPO)

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Angel Broking logo

Angel Broking, incorporated in the year 1996, is one of India’s oldest stockbroking houses. In terms of the number of active clients on the National Stock Exchange (NSE), the company is the country’s fourth largest retail stockbroking house, with a market share of around 6.3% as of June 2020. With over 22 years of experience in the stock market industry, Angel Broking has succeeded in catering to a loyal client base comprising around 2.15 million operational broking accounts (as of June 2020). Now, the company is aiming to raise additional capital by putting its shares up for subscription by the public via an Initial Public Offering (IPO).

Angel Broking has filed its Draft Red Herring Prospectus (DRHP) (https://www.sebi.gov.in/filings/public-issues/jul-2020/angel-broking-limited-addendum-to-drhp_47089.html) with the Securities and Exchange Board of India (SEBI).

By issuing an IPO, Angel Broking would be adding another win to its already impressive scoreboard.

Details of the Angel Broking IPO:

Here are the important details about the upcoming Angel Broking IPO issue.

  • The issue date: September 22nd to September 24th 2020
  • .Price band fixed at Rs 305 to Rs 306 per equity share of face value of Rs 10 each
  • The initial public offering consists of the Equity Shares of the Company aggregating up to Rs. 6,000.00 Million comprises of a Fresh Issue Company aggregating up to Rs. 3,000.00 Million (“Fresh Issue”) and an Offer for Sale aggregating up to Rs. 3,000.00 Million (the “Offer for Sale”), consisting of an offer for sale aggregating up to Rs. 183.35 Million by Ashok D. Thakkar and up to Rs. 45.00 Million by Sunita A. Magnani (together, the “Promoter Selling Shareholder”), and up to Rs. 1,200.02 Million by IFC (the “Investor Selling Shareholder”) and up to Rs. 1,571.63 Million by the Individual Selling Shareholder (together with the Promoter Selling Shareholder and the Investor Selling Shareholder, the “Selling Shareholders”) (the Offer for Sale together with the Fresh issue, the “Offer”).
  • Bids can be made for a minimum of 49 Equity Shares and in multiples of 49 Equity Shares thereafter.

  • The Equity Shares offered in this Offer are proposed to be listed at both BSE Limited and the National Stock Exchange of India Limited (“NSE”) post the listing. For the purpose of the offer, NSE is the designated stock exchange.

Why should you subscribe to the upcoming Angel Broking IPO?

Angel Broking has been on the broking and stock market scene for over 2 decades now and enjoys a strong brand value. Additionally, the IPO now comes at a time when the company is experiencing exceptional growth in its client base.

That’s not all; here are some more compelling reasons why you should consider subscribing to the Angel Broking IPO.

1. India’s fourth largest retail broking house Thanks to a market share of 6.3%, Angel Broking is currently India’s fourth largest retail broking house in terms of the number of active clients in the NSE platform. In addition to this, the company has also enjoyed an average monthly client addition of approximately 115,565 clients in Q1 FY21 alone, as opposed to an average monthly client addition of 46,676 clients for the whole of FY20. This translates to an impressive growth rate of over 147.59%. With such tremendous growth, the company is well poised to climb up the ranks in the near future.

2. Exceptional brand equity With more than 2 decades of experience and presence in the stockbroking industry, ‘Angel Broking’ as a brand has garnered a significant amount of respect and brand equity. Over the years, the company has striven hard to build robust online and digital broking platforms to cater to the varying needs of its clients. ‘Angel Broking’, ‘Angel BEE’ and ‘ARQ’ are all well-recognized brands in the stock market scene. In fact, the strong brand equity and presence that Angel Broking commands in the industry has directly had an impact on the company’s client acquisition process. Among the average monthly client additions during the whole of FY20, around 11,249 clients were acquired by the company through referrals. This referral acquisition number increased to around 23,942 clients per month in Q1 FY21, which serves only to reaffirm the level of brand equity enjoyed by the company.

3. Consistent growth over the past few years Angel Broking has been witnessing unprecedented levels of growth on all fronts. With respect to gross client additions, the company has seen consistent growth from around 0.22 million in FY18, 0.26 million in FY19, 0.56 million in FY20 to 0.35 million in FY21. This impressive rise in the number of clients represents a 59.54% CAGR over the period from FY18 to FY20. In addition to this, Angel Broking’s base of active clients in the NSE platform also witnessed a rise from 0.36 million in March, 2018, to 0.41 million clients in March, 2019, to 0.58 million clients in March, 2020 and further to 0.77 million clients in June, 2020. And finally, the company’s average daily turnover has also seen a significant growth of around 144.47% in just a span of a year from Rs. 253,176 million in Q1 FY20 to Rs. 618,945 million in Q1 FY21.

4. Diversified product portfolio that caters to a wide-range of clients’ needs Over the years, Angel Broking has built a strong online and digital infrastructure with an increased focus on developing technology-driven processes and platforms. This has not only disrupted the stockbroking industry, but has also helped the company cater to the differing needs and requirements of various clients. Some of the class-leading digital tools and platforms created by Angel Broking include the Angel Broking smartphone mobile application, web browser-based trading platform (trade.angelbroking.com), Angel SpeedPro, Angel BEE, and ARQ - A rule based investment engine. In addition to these technological platforms, the company also provides a host of other financial services such as investment advisory, investor education, research services, margin funding, loan against shares, and distribution of various financial products to its clients.

5. High potential for further growth As the penetration of internet and smartphones continue to increase multi-fold in the country, a major chunk of new-age investors from Tier-2 and Tier-3 cities are making their way into the stock market. In fact, more than 450 million new investors have come from Tier-2 and Tier-3 Indian cities. This number is likely to only rise even further in the coming years. The changing market dynamics and shifting consumer base have opened up an extensive world of possibilities, which Angel Broking is perfectly poised to take advantage of using its pan-Indian customer outreach and diversified digital platforms. Conclusion Considering these factors, Angel Broking IPO looks to be a very attractive option for investors. By subscribing to this issue, investors may experience impressive growth rates of up to 25%, as the recent IPOs have clearly shown us.

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