By Pratik Bhakta
Angel One鈥檚 new group chief executive officer, Ambarish Kenghe, expects business momentum to pick up by the end of the current financial year as the immediate effects of the regulatory changes on speculative trading and the global macroeconomic challenges settle down.Kenghe, who previously led Google Pay in India, assumed the corner office at the stockbroker four months back. He joined the business at a time when stock market regulator Securities and Exchange Board of India tightened the rules around the speculative futures and options (F&O) trading business. This has disrupted tech-first startups like Zerodha, Groww, Dhan and Angel One, who get a large part of their revenue from F&O trades.Mumbai-based Angel One reported a 48% fall in net profit to Rs 174 crore in the fourth quarter of FY25, when revenue fell 22% to Rs 1,056 crore from a year earlier. Despite the hit due to regulatory changes, its fiscal year revenue grew 22% to Rs 5,238 crore, while net profit grew narrowly to Rs 1,172 crore from Rs 1,125 crore.Groww reported a total revenue of Rs 4,056 crore and a net profit of Rs 1,819 crore in FY25. Zerodha chief executive Nithin Kamath said he is expecting a 20-30% drop in the broking business, but has set a target of achieving Rs 10,000 crore in revenue by FY26. In FY24, its last declared financials, the company reported a net profit of Rs 4,700 crore on a total income of Rs 8,320 crore.Venture-funded Groww, which was recently valued at $7 billion in a private funding round, is seeking to go public and filed its draft red herring prospectus with capital markets regulator Sebi in May. In terms of active clients on NSE, Groww is the top brokerage with 12.9 million, followed by Zerodha and Angel One at 7.8 million and 7.5 million clients, respectively.鈥淲e plan for the long-term and the guidance in our last management commentary was that the revenue curve has bottomed out, and there are signs of improvement since March,鈥 Kenghe told ET. 鈥淲e expect momentum to build up meaningfully by Q4 FY26.鈥滻n a note published on April 29, Crisil Ratings said the stress in the equities market resulted in average turnover for cash and F&O trading to fall by around 26% between the third and fourth quarters of FY25.For Angel One, during the same period, the turnover fell 20% to Rs 32 lakh crore, it said. The note stated that over the last five fiscal years, around two-thirds of Angel One鈥檚 revenue came from stockbroking.At the group level, Ange One is trying to reduce its dependence on core broking and has broad-based its operations into mutual fund distribution, wealth management, manufacturing mutual fund products and is also focusing on scaling up the lending business. Additionally, Angel One is also leveraging its 9,400-strong agent network, referred to as authorised persons, to offer services for investors who need assistance.ET reported in February that Angel One’s wealth management arm Ionic Wealth had created a $250 million asset base within one year of launch.Groww and Zerodha have also diversified their business bets in a bid to reduce their dependence on stockbroking for revenue. While Groww acquired Fisdom to enter into wealth management, Zerodha is scaling up its lending business, Zerodha Capital. Both Groww and Zerodha have set up their own asset management businesses as well.鈥淲e are doing passive funds through our AMC; we have built an average asset under management of over Rs 200 crore, which will grow. We are also facilitating personal loans through six partner lenders,鈥 Kenghe said.The company got its AMC licence in November 2024.While Angel One is not using its in-house finance company, it has disbursed around Rs 700 crore in personal loans through six lending partners.Coming from a tech background, Kenghe, who had also worked at Myntra, wants to enable the adoption of artificial intelligence across the multiple business verticals of this 1996-founded company.He explained that he is looking at using AI more frequently in personalisation of products, communication with clients like getting welcome videos to be completely AI generated or market reports to be read out in different languages through the use of AI. Kenghe is also pushing his team to use AI for upskilling and learning and it is also being used for operational efficiency like in KYC, customer onboarding and document verification.