Angel One stock dips 7% post NSE’s ₹1.6 cr penalty

Shares of online stock brokerage Angel One dipped more than 7% today after the National Stock Exchange (NSE) imposed a monetary penalty of ₹1,66,89,000 (₹1.6 crore) on the company for an alleged violation of the Capital Market Segment Regulations, and Futures & Options Segment rules, thereby logging its steepest intraday percentage decline.

The Angel One Ltd stock opened gap down at ₹1,637.75 today, compared to the previous session close of ₹1,707.50 and fell to an intra-day low of ₹1572.45. Before closing of trading, around 78,000 shares were exchanging hands at the counter against a two-week average of 36,000. At the current share price, the company's market cap stands at ₹13,249.75 crore.

The technology-led financial services company, in its statement, says the order does not affect the existing business or the activities of the authorised persons affiliated with the company. "The company is evaluating various options available including filing an appeal against the Order." The online brokerage says it has always strived to and carried out its business in compliance with extant laws and regulations in letter and spirit.

NSE last week prohibited Angel One from onboarding new authorised persons (APs) for a period of six months from the date of the order, and directed to conduct an inspection of all its APs and submit a report in six months. The NSE order was passed in respect of an alleged failure to monitor the operations of its APs.

In addition to this, the NSE also directed Angel One to submit a detailed report on its "investor grievance redressal mechanism" comprising total investor complaints and arbitration matters registered against the company and its APs in the past year, including those pertaining to assured returns and unauthorised trading, and those resolved in the said period.

Notably, Angel One last week onboarded Deepak Chandani as chief data officer, who will be responsible for overseeing the data and analytics strategy at Angel One. With Deepak’s onboarding, the company aims to harness the benefits of a large data lake via artificial intelligence, machine learning, and analytics.

Angel One says it is extensively using AI, machine learning, and data science to create a superior digital experience. The company has built a host of digital properties like Angel One Mobile App, Angel BEE Mobile App, ‘ARQ Prime’ a rule-based recommendation engine, ‘SmartAPI’ a free-to-integrate API platform, ‘Smart Money’ an investor education platform, and ‘SmartStore’, a marketplace for fintech products.

Angel One reported a consolidated profit of ₹220.8 crore in Q1 FY24 as compared to ₹181.6 crore in the year-ago period, thus recording a growth of 22% on a year-on-year basis. The company's total revenue grew 18% to ₹811.1 crore in Q1 against ₹684.5 crore in the year-ago period.