As investors navigate the competitive landscape of discount brokerage firms in India, two names stand out: Angel One and Zerodha. While Zerodha has established itself as the largest discount broker by revenue, Angel One presents an impressive rating and growth trajectory that makes it a compelling option for investors. Given that Zerodha is not listed on the NSE or BSE, many may consider investing in Angel One instead. Let’s explore the key metrics and insights that can help you make an informed decision.
Performance Overview
Zerodha’s Financial Highlights
Zerodha has reported significant growth, with profits soaring 62% to ₹4,700 crore for the financial year 2023-24. Its revenue also climbed by 21%, reaching ₹8,320 crore. This remarkable performance underscores Zerodha’s dominance in the discount brokerage space, especially in futures and options (F&O) trading.
- Active Customers: 7,884,365
- Market Capitalization: ₹22,935 crore
- Operating Margin: 57% (potentially rising to 69% with unrealized gains)
Founder and CEO Nithin Kamath highlighted the firm’s robust financials but also the uncertainty surrounding regulatory changes affecting F&O trading, which is a significant part of their revenue model.
Angel One’s Competitive Edge
On the other hand, Angel One boasts a higher overall rating of 4.5 out of 5, positioning it favorably against Zerodha. Although it has a slightly lower active customer base of 7,132,861, Angel One shows strong growth metrics and a solid financial foundation.
Key Metrics:
- Stock Price: ₹2,544
- Profit Growth: 69.8% CAGR over the last 5 years
- Return on Equity (ROE): 43.3%
- Dividend Yield: 1.36%
- P/E Ratio: 19.1
- Book Value: ₹362
- Healthy Dividend Payout: 33.0%
- Debtor Days Improvement: From 59.0 to 41.6 days
Angel One’s robust ROE and consistent dividends make it an attractive option for long-term investors seeking reliable returns.
Why Choose Angel One?
- Higher Rating: Angel One’s rating of 4.5 out of 5 reflects superior customer satisfaction and service quality.
- Strong Financial Growth: With a profit growth rate of 69.8% CAGR over five years, Angel One shows promising potential for future gains.
- High Return on Equity: An impressive ROE of 43.3% indicates effective management and profitability.
- Consistent Dividend Payouts: A healthy dividend payout of 33% provides investors with income and underscores financial stability.
- Market Accessibility: Since Zerodha is not listed on the NSE or BSE, Angel One offers a more accessible investment opportunity for retail investors.
Conclusion
While Zerodha leads in terms of active customers and revenue, Angel One’s higher overall rating and impressive growth metrics position it as a strong contender for investment. Given Zerodha’s non-listing on major exchanges, Angel One becomes an even more attractive option for investors seeking exposure in the discount brokerage space.
