Buy Angel One, target price Rs 1,945: Hem Securities

Hem Securities has buy call on Angel One with a target price of Rs 1945.0. The current market price of Angel One is Rs 1659.55.

Angel One, incorporated in the year 1996, is a Small Cap company (having a market cap of Rs 13746.26 crore) operating in Financial Services sector.

Angel One key Products/Revenue Segments include Fees & Commission Income, Interest and Other Operating Revenue for the year ending 31-Mar-2021.


Financials
For the quarter ended 31-03-2022, the company has reported a Consolidated Total Income of Rs 685.32 crore, up 12.88% from last quarter Total Income of Rs 607.11 crore and up 63.62% from last year same quarter Total Income of Rs 418.86 crore. Company has reported net profit after tax of Rs 204.69 crore in latest quarter.

Investment Rationale
Demand for financial products is likely to rise, particularly in tier 2-3 cities, as financial literacy, cellphone penetration, increased awareness, and the creation of Jan Dhan bank accounts increase.

In reality, the change is obvious in the last 2-3 years, as evidenced by the increase in demat accounts. Total demat accounts were 41 million in FY20, 55 million in FY21, and 90 million in FY22. Work from home culture, excellent equity market returns, record number of IPOs, and lower interest rates attracted a big number of new investors to the stock market as a result of the pandemic-driven lockdown.

The brokerage values the company at 21.7x FY23 EPS to arrive at the target of 1945.

Promoter/FII Holdings
Promoters held 44.0 per cent stake in the company as of 31-Mar-2022, while FIIs owned 8.96 per cent, DIIs 10.33 per cent.