Release Date: July 16, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- 5paisa Capital Ltd (NSE:5PAISA, Financial) reported a significant growth in customer acquisition, with a 116% year-on-year increase, reaching a total customer base of 4.47 million.
- The company's average daily turnover (ADTO) grew by 27% year-on-year, reaching INR3.67 trillion.
- 5paisa Capital Ltd (NSE:5PAISA) achieved its highest ever PAT of INR20.1 crore, marking a 248% quarter-on-quarter growth and a 39% year-on-year increase.
- The mutual fund AUM of the company saw a substantial 90% year-on-year growth, reaching INR1,124 crore.
- The company introduced several technological advancements, including enhanced features for option traders in their mobile app and a revamped web platform, Trade Station 2.0, for high-end traders.
Negative Points
- There was a conscious decision to reduce customer acquisition in the last one to two months to improve the quality of customers, which led to a small drop in acquisition numbers.
- The market share of 5paisa Capital Ltd (NSE:5PAISA) in both the cash and FnO segments stands between 2% to 2.5%, which is lower than previous targets.
- The company has not yet entered the lending business, which could be a potential area for growth and cross-selling income.
- There was a significant ESOP reversal in the quarter, primarily related to the departure of Narayan Gangadhar and other employees.
- The company is currently without a CEO, and the search for a new CEO is ongoing, which may impact strategic direction and investor confidence.
Q & A Highlights
Q: What is the market share of Cash and FnO?
A: Our market share stands between 2% to 2.5% for both cash segment as well as FnO segment. - Gourav Munjal, CFO
Q: How do you see the lending business growing in the next 5 to 10 years in terms of cross-selling income?
A: Right now, 5Paisa is fully concentrating on the broking business. As of now, there is no plan to enter the lending business. - Gourav Munjal, CFO
Q: Could you explain the circumstances around the departure of Narayan Gangadhar and the ESOP reversal?
A: Narayan Gangadhar is still part of the IFL Group. The ESOP reversal this quarter is largely related to him and some other employees. - Gourav Munjal, CFO
Q: Are you still aiming to double your market share to 6-7%?
A: Yes, we are working towards increasing our market share to 6%. We are focusing on quality acquisitions rather than just numbers. - Gourav Munjal, CFO
Q: How will regulatory changes impact your business, and do you have strategies for diversification?
A: Regulatory changes are expected, but historically, they have not significantly impacted volumes. We are prepared to adapt and have diversified strategies to grow our ADTO market share. - Gourav Munjal, CFO
Q: What updates can you provide on your product development, particularly the mobile app and web platform?
A: Our revamped mobile app for iOS and Android will be live by the end of Q2 FY25. Trade Station 2.0, our revamped web platform, is now accessible to all users, offering an enhanced user experience. - Ameya Agnihotri, CTO
Q: Is there a search for a new CEO, and when can we expect an update?
A: Yes, the search for a new CEO is ongoing, and we will update investors as soon as we have more information. - Gourav Munjal, CFO
Q: How do you plan to address the decline in market share and ensure robust product offerings?
A: We have made significant progress in revamping our technology and user experience. Our new mobile app and web platform are part of our strategy to regain market share. - Ameya Agnihotri, CTO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
