https://www.financialexpress.com/money/fampo-transactions-may-attract-higher-tax-rate-3529354/
How negative can SEBIâs stand against derivatives turn out on Angel One?? Because majority of business comes from derivatives.
I donât think anything major will happen. Market seems to have already discounted this into Angel Oneâs stock. But yeh, the stock might consolidate for sometime now, until their wealth management business picks up.
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It seems, with the new SEBI directive there would be a significant drop in the growth of the company. Does staying invested in this will be a value trap?
Thinking the same. I dont see a lot of downside from here but not sure if it will move up for some time.
Really confused! Any ideas from anyone.
The stock has been in a downtrend. Itâs forming lower highs, and is below 30 weekly ema. Today the volume of sell off was quite huge. Feels like the stock is in stage 4. I think one needs to wait for things to settle down before taking a call on investing.
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What do you mean by stage 4?
Stage Analysis is a strategy for longer term trend trading. It was discussed in detail by Stan Weinstein in the book Secrets for Profiting in Bull and Bear Markets. Stage Analysis uses chart patterns to describe four distinct stages that a particular trade can be in.
Stage 1: Base Formation
Stage 2: Advancing/Uptrend
Stage 3: Consolidation/Topping
Stage 4: Decline
A link to read stage analysis: Trading With Stage Analysis
Soic has a video explaining the same: https://youtu.be/HHZBnmnFdjQ
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**Angel One Q1 FY 25 Concall Highlights**
¡ If there are restrictions on No.of expiries for F&O it would have little impact as there are still Weekly and monthly expires and trading goes across the month.
¡ Regarding Impact if the lot size increases management said they can mitigate the impact by levering charges on other segments, Also a participant asked what if the lot size increased to 20-30 lakhs the management said they can manage that level and not sure after that
For most of the questions on regulator actions management said we need more time to analyze the situation until clear guidance from the regulators They also said they have enough levers( if possible they are also looking to charge on equity delivery orders) to offset those impacts and Due the size they have there are more efficient than other 4 major online brokers
¡ Management commented they are confident that EBITA margins will be at 47-48% after a few quarters
¡ Remaining most of the questions on MTF and Wealth management segment
¡ AMC licenses are getting delayed due to elections it is in the final and they said they got great response on wealth management side Domain Knowledge, tech, and Relationship managers are their 3 pillars in it
¡ There is 1-1.5% impact on operating profit due to new business
¡ MTF - Margin Trading Facility allows to buy a stock by 1/4 of the total transaction value. Angel One funds the balance amount. Interest rate is 18% per annum.
Industry size: 75000 Crores, Angle one share is 5% and the top one has 20%
¡ Mgmt said if charges on F&O increases then customers shift to MTF
Question by participant: Does 0 brokerage on equity indirectly drive MTF
Mgmt: We donât believe charges on equity delivery impact MTF book
¡ Mgmt believe there will be no change in Life time value of the customer
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Stock continues to fall, i am new to the markets but i really feel that the stock is at 17p/e and is correctly priced, but i wonât touch it till it offers a bit more margin of safety, because a lot of headshots might come from the government or the regulator which are already in the air, and the data that india is 80 percent of worldâs fno volumes is simply mind boggling, this makes me feel that something bad is about to happen to the company.
Not invested.
May be may be not, we also need to understand and take it into perspective the Demographics of most of the world and where the demographic lives (T1,T2,T3) needs to be considered.
Yes, I agree that the Indian FnO markets are sought after the most by retail investors with <1 year(s) of experience in the markets, it is a problem. But Indirectly many more retail investors are picking up regular SIPs, which is good for the markets.
Can someone help me out with the view on Angel one. Valuations seem attractive . However , I am cautious about sustainability of earnings with the overhang of SEBI actions.
Definitely an attractive opportunity. However, keeping an eye on the chart pattern.
The last 7-8 months, the stock has been making lower tops and bottoms. Unless it goes to 13-14 PE, I personally will not buy it. However, I will be ready with the cash. Very high-quality company, transitioning to a stable AMC business.
However, you can buy if a further 10-15% drop does not bother you. Because I feel long-term (>3-5 years) will be good.
Stance: Quite biased. This is the highest allocation in my portfolio. Looking to invest more, if the trend reverses or stock becomes extremely cheap. Currently, 10% lower compared by average buying price
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I think you should wait before you invest more in this stock. If the SEBI tantrums regarding options trading result in something meaningful, it will be very negative for broking companies as majority of their Revenues come from Options.
Believe me, I have been waiting for this stock to correct for a very long time, but given the regulatory uncertainty, I am not super confident about Investing right now. The valuations are cheap, but one needs to determine the reasons behind this. If shrinking Revenues and Profits due to Regulatory risk is a possibility, then this stock may be accurately priced.
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I am in a similar boat. The average price is 5% higher than the current market price. The current valuation looks really attractive, I am waiting for the budget tomorrow and next quarterâs results.
Its transition to AMC will bring stability, they have also started giving loans and planning to add more financial products in their suite. It looks like a very attractive company for long run with a business model that is here to stay.
Disclosure: Biased and invested
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I agree that they are expanding into new business segments.
If we consider the AMC business, it will take a lot of time to have any impact on the bottomline. HDFC AMC has an AUM of more than 4Lakh Crore and after this AUM, their bottomline is close to 2000cr. Imagine how long it will take for the AMC business to be meaningful for Angel. Also, they are mostly interested in Index Funds with lower commissions. So I am not really sure how this business segment is going to mature for this company.
Secondly, if the broking business is so strong or basically on steroids in India, why enter lending or any other business? Are they also expecting some regulatory pressure from SEBI and hence diversifying their product base?
I just feel the regulatory environment is very uncertain and in such scenarios it is better to wait out any developments.
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