Equity L/S Analyst | Forensic Accounting | India, Yellowstone Equity

Ankit Agrawal, CFA

Equity L/S Analyst | Forensic Accounting | India

Equity Bottom-Up

<a href="https://www.smartkarma.com/entities/angel-broking-ltd" target="_blank" data-smartkarma-citation="entities:33510:1" rel="noopener">Angel Broking (ANGELBRK IN)</a>'s stock has risen &gt;4x over the last four months on the back of strong growth in the digital broking industry in India. However, we think the stupendous growth of &gt;17x in Angel's active client base over the past couple of years may not sustain. While the shift to digital and discount broking is inevitable, the recent growth seems to be temporary and will likely reverse led by high customer churn. Cyclicality and heightened competition in the sector will further adversely impact the fundamentals and lead to de-rating of the stock once the euphoria in the sector subsides. The market is also pricing in high optimism around Angel's potential to be a fintech platform. We again differ here based on our insights into Angel's customer base, competitive scenario and nascent track record of Angel in the quasi-passive quant-based asset management and wealth management space.

Angel Broking (ANGELBRK IN)'s stock has risen &gt;4x over the last four months on the back of strong growth in the digital broking industry in India. However, we think the stupendous growth of &gt;17x in Angel's active client base over the past couple of years may not sustain. While the shift to digital and discount broking is inevitable, the recent growth seems to be temporary and will likely reverse led by high customer churn. Cyclicality and heightened competition in the sector will further adversely impact the fundamentals and lead to de-rating of the stock once the euphoria in the sector subsides. The market is also pricing in high optimism around Angel's potential to be a fintech platform. We again differ here based on our insights into Angel's customer base, competitive scenario and nascent track record of Angel in the quasi-passive quant-based asset management and wealth management space.  

Angel Broking: Riding the Digital Broking Wave in India, But It May Slip

Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

ASA Capital Management

ASA Capital Management is a boutique Research and Investment Advisory firm focusing on primary research in India. ASA provides bespoke research services to Institutional Clients with a focus on due diligence backed with primary research, Field Trips & Channel Checks.

Private Capital Markets

<a href="https://www.smartkarma.com/entities/zerodha" target="_blank" data-smartkarma-citation="entities:29664:1" rel="noopener">Zerodha (ZERO IN)</a> is attractively placed in the Indian Broking Industry. The core focus on both, the concept of self-service and a tech-savvy trader/investor has helped Zerodha gain market share which it is likely to maintain, in spite of competition inching up. With one of the lowest penetration of shares as a percentage of household savings, the industry dynamics remain favourable. 
With presence across all asset classes for trading/investing and future plans to offer US Equities to clients and asset management services, Zerodha is likely to remain the force to reckon with.

Zerodha (ZERO IN) is attractively placed in the Indian Broking Industry. The core focus on both, the concept of self-service and a tech-savvy trader/investor has helped Zerodha gain market share which it is likely to maintain, in spite of competition inching up. With one of the lowest penetration of shares as a percentage of household savings, the industry dynamics remain favourable. 
With presence across all asset classes for trading/investing and future plans to offer US Equities to clients and asset management services, Zerodha is likely to remain the force to reckon with. 

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Zerodha (ZERO IN)

Angel Broking: Riding the Digital Broking Wave in India, But It May Slip

Angel's stock has risen 4x in the last four months on the back of rise in digital broking in India. However, aggressive customer acquisition...

Ankit Agrawal, CFA

Zerodha | India's Own Robinhood

What’s the primary reason for the Insight (price action, news flow, upcoming events etc)? What action would you suggest to an investor?

Pranav Bhavsar

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