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Ladies and gentlemen, good day, and welcome to Angel One Limited Q4 FY '24 Earnings Conference Call. [Operator Instructions] Please note that this conference is being recorded. This conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict.
I now hand the conference over to Mr. Hitul Gutka from Angel One Limited. Thank you, and over to you, sir.
Good morning, and welcome, everyone. Thank you for joining us today to discuss Angels One's Q4 FY '24 financial and business performance. The recording of today's earnings call and transcript will be uploaded on our website under the Investor Relations section. The financial results, investor presentation and press release are also available on the website.
For today's call, Angel One is represented by Dinesh Thakkar, Chairman and Managing Director; Vineet Agrawal, Chief Financial Officer. We also have the senior leadership team of Angel One along with SGA, our IR consultant. The leadership team will give us a brief overview of the operational and the financial performance of the quarter gone by, which will be followed by a question-and-answer session. Please note that there may be certain forward-looking statements made during the call which must be viewed in aggregate with the risks that the company faces.
With this brief introduction, I now invite Dinesh Thakkar for his opening remarks.
Thank you, Hitul. Good morning, everyone. In the financial technology industry where innovation is the currency of progress, Angel One has stood as a beacon of excellence for 3 decades. Today, as we gather through the year, I'm filled with gratitude for the journey we have traversed, the milestones we have achieved, the trust we have garnered among our clients. Our legacy is one of relentless pursuit of excellence, innovation and trust. Through this pursuit, we have established ourselves as a formidable player in India's fintech landscape, where our name resonates as a symbol of reliability and innovation.
Our digital outreach has enabled clients located beyond metros and Tier 1 cities to access and consume capital market products. This democratization of financial services has been one of our pillars of growth, and we continue to deepen our roots into untapped opportunities.
As we have reinvested in expanding our client base and offer them a more robust platform, we have witnessed very strong growth. I'm delighted to share that our average daily order has grown 86% between quarter 1 and quarter 4 of FY '24.
In the process, we achieved peak order -- in that process, achieved the orders per day of more than 10 million. This growth is detrimented to the resonance of our vision and the effectiveness of our performance. With strong growth comes a responsibility to ensure a decent capitalization to sustain and fuel our expansion. In this period, we recently completed a capital raise of INR 15 billion, which will be primarily used for margin moneys with stick exchange and the growth of our MTF book. This effort underscores our commitment to prudently manage our resources.
We are extremely thrilled and humbled by overwhelming response our fundraise received from both domestic and foreign investors as a testament to the confidence they have in our vision and stability.
To all investors, both existing and new, I extend my heartfelt gratitude for your invaluable support and belief in our journey. Turning to our operational performance. I'm delighted to share with you that Angel has once again delivered a historic performance during the quarter. We have experienced our highest-ever quarterly gross acquisition, expanding our client base to a new high of over 22 million. Furthermore, our client executed over 470 million orders during the quarter.
This client search, coupled with robust activity witnessed on our platform -- across our platform -- across our product and service offering, come from the resilience and the scalability of our systems. At the heart of our growth story, life and unwavering commitment to client centricity, these ethos have guided us through our digital transformation journeys, enabling us to build a solid roster of clients, who not only transact with us, but also educate for us.
Each Board acquired has consistently given us stable revenue every year. Our Vintage Plant 2, who had been with us for more than 5 years, continue to contribute very healthy revenues even today. Higher sand acquisition year-over-year, their revenue contribution is consistent like the previously acquired cohort.
The stability and profitability exhibited by each cohort and the continuous influx of new clients serves as a bedrock for our future growth. Our digital model not only enables us to penetrate deeper into market but also fosters long-term relationship with a younger demography, driving value creation and client longevity.
Through this digital engagement, clients from every acquired year tend to become active and transit in one or more segment over time. For instance, about 54% of clients acquired in FY '21 became acute over the next 4 years and continue to engage on our platform across multiple segments. It is heartening to note that even in the space of clients, who commenced the journey as a trader, an overwhelming majority of them eventually build long-term equity portfolio, thus realizing the virtues of investing in equity as an asset class.
This journey of value announcement from novice trader to mature investors is extremely increasing and defines client longevity on our platform, thus ensuring sustained growth in lifetime value of the customer. It also motivates us to offer our clients other value-added services and partner with them in their quest for wealth creation.
As we chart the course for the future, our focus remains steadfast to enhance client experience on our platform through superior engagement journeys and product announcement to create value at every touch point. We continue our focus on further fine-tuning our KYC journey, which is the first point of client interaction with our systems. We undertook development on the Super App with the rollout of dedicated sections for option strategies, allowing traders to discover and execute predefined and custom strategies easily.
We also released a dedicated option expiry section, which simplifies saving option on expiry days. To encourage creating long-term investment behavior, we announced revenue for the cash segment as we introduce stock we get featuring a list of popular stocks, most traded stocks on the home page, a predefined watch list segmented to some predefined personas.
Dedicated to revisualize client engagement and experience, our assisted business had been building a dynamic array of products. As a part of development, we are transforming the NHP application a universal platform for all our channel partners. Key developments currently being carried out include NGT and intelligent features, empowering our channel partners for a better lead generation and management. With clear call to action button and high degree of personalization, the platform acts as a personalized permutation engine for our channel partners.
In our mutual fund journey, clients can now customize SIP amount and dates, compare up to 3 mutual funds across all available parameters and track portfolio growth against indices. These innovations are driving significant growth in SIP adoption, reinforcing our position as the second largest player in incremental registered SIP. This underscores the effectiveness of our Super App state and the value it delivers to our clients.
Last quarter alone, we registered nearly 1.4 million unique SIP, showcasing our commitment to guiding clients on their long-term investing journey and enhancing engagement on our platform. Efforts continued during the quarter to seamlessly integrate credit asset income product into our platform, which is currently undergoing beta testing with select clients.
Having crafted the MVP for this offering and initiating rigorous testing to ensure reliability and effectiveness, we expect to scale up the operation over the next few quarters.
On the AMC front, we have on-boarded the core leadership team, who had been working to get the final approval from the regulator for the swift launch. With respect to our wealth management foray, I'm happy to introduce to you the team led by [indiscernible] Subramanian as the cofounders of our Wealth Management business.
[indiscernible] has extensive experience at Kotak Mahindra Bank in life insurance Avidbank, including global wealth management and investment advisory and more prominently in the wealth type initiatives at Kotak Cherry. The cofounders of decade of combined deep domain expertise across the function of wealth business and demonstrate impeccable skills to scale the wealth business with a sharp focus on debt-led models, while we will target the fast-growing segment of UHNI and HNI, we endure to progressively democratize this offering to the underrepresented segment and retail through differentiated digital offerings.
During the quarter, we further solidified our management bandwidth with the on-boarding of Mineral Maheshwari Shah as our Group General Counsel. With a remarkable career spanning over 14 years, Minesh's expertise extends to working on diverse transaction, navigating complex legal landscape and trading insightful counsel on legal, quality and regulatory matters. Prior to joining Angel One, Minesh served as a Group Legal Director and Data Protection Officer at Lima 3 PTV Limited, a subsidiary of Tamasi; led the legal function at SR and Times of India.
We have secured the associate partner sponsorship for the coveted India Premium League IPL for 5 years starting in 2024. This sponsorship promises us extensive brand visibility through on-ground digital and televised media, allowing us to engage with a wider audience, particularly in Tier 2 and Tier 3 cities and beyond.
Our investments in quarter 4 FY '24 reflects our proactive stance in expanding our team, client base and technological capabilities to continuously find our client experience. While these investments may impact short-term margins, they are crucial to our long-term growth and profitability. Let me now take you through some of our operational highlights.
We on-boarded about 2.9 million clients within the quarter, taking up the total client base of 22.2 million clients. This serves as a testament to our commitment to operational excellence. Robust line activity grew a 35% sequential increase in total executed orders for the quarter.
The ADT on our platform continued its up trend, growing by 23% quarter-on-quarter to nearly INR 44 trillion. Looking ahead, we anticipate sustained growth requiring increased working capital deployment. Consequently, the Board has decided to defer dividend payout for the next few quarters to conserve resources, optimize our balance sheet and support our growth trajectory.
Now Vineet will walk you through our financial performance before we open the floor to your questions.
Thank you, Dinesh. Good morning, everyone. As highlighted by Dinesh, quarter 4 of FY '24 has been a very strong operational quarter for us, as we achieved our historic best performance yet again with average daily orders growing by 32.3% sequentially to 7.73 million, taking our aggregate order count higher by 34.5% sequentially to 4.71 million in quarter 4 of FY '24.
We clocked our highest ever quarterly gross total revenue at INR 13.6 billion, registering a 28% quarter-on-quarter growth. Gross booking revenue grew by 30% quarter-on-quarter to INR 6.92 billion. Gross booking revenues accounted for 68% of our gross total revenues. Within this, continues to drive the gross booking revenue, contributing 85% in quarter 4 of FY '24, while the share of cash in commodity segments remained stable at 11% and 4%, respectively.
Since majority of our clients are part of our direct business, their share in the net booking revenue stood at approximately 77%, while the balance, 23%, was contributed by clients acquired through our assisted business. Our volumes in the cash delivery segment continued to improve. Higher activity in this segment is an important lever for growth of our client funding book, which grew by 9.1% sequentially to average at INR 20.3 billion for the quarter. This led to a corresponding growth in the interest we earned on this book. The interest turned on client funding, along with the interest turned on repo exchanges, led to a 16.6% sequential growth in our total interest income to INR 2.5 billion, thus accounting for about 18% of the total gross revenues for the quarter.
The ancillary transaction income linked to the turnover clients drew on our platform grew by 34.7% quarter-on-quarter to approximately 1.1 billion, accounting for nearly 8% of our quarter 4 total gross revenues. Finance cost was higher by about 56% quarter-on-quarter to INR 556 million in quarter 4 of FY '24, due to a combination of higher average borrowings and higher cost of funds for the period. Higher borrowings were in line with the growth in client funding book and borrowings avail to fulfill margin obligations with the clearing corporations.
The overall finance cost for the year has been within the anticipated increase, as envisaged last year, on account of incremental working capital required to manage the bank guarantee requirements for margin obligations. With every trading day as an expiry date for indices across NSE and BSE and growing volumes, the working capital requirement for broking businesses of our scale and size have increased considerably over the last few quarters.
Employee benefit expenses, including cost of granting new shops, was at about INR 1.59 billion for the quarter, sequentially higher by 12% due to additional headcount, primarily in the wealth management business, ramp-up of our asset management business, data analytics, technology and product functions.
Our other OpEx for the quarter dropped at INR 4.3 billion, being 33% higher sequentially, driven by 17% growth in our client acquisition, leading to an increase in onetime client acquisition costs and on-boarding costs. Other expenses for the quarter also include INR 227 million, a portion towards IPL associate sponsorship for related and related digital and media advert spends.
Operating expenses were also higher on account of higher spends on cloud infrastructure in line with the growth of the business. Here, I would like to inform you that Angel One will continue to invest in scaling up its brand over the next few years.
In the going quarter, we intend to spend about INR 1.2 billion towards remainder of the annual sponsorship costs and digital electronic media advert throughout the ongoing IPL season. Our brand spend thereafter, for the rest of the year will be in line with earlier trends. However, such spend will help us to significantly amplify the brand across the country, giving us better reach to our target audience.
Our consolidated EBITDA margin expanded to 44.8% for the quarter versus 44% in quarter 3 of FY '24. This margin remains within our guided range. The upfront onetime investment in acquiring more clients today helps us to grow the business going forward, thus reaping benefits of better operating leverage.
Depreciation and amortization costs increased by 27% to INR 167 million quarter 4 of FY '24 on account of augmentation of technology assets at our data center in disaster recovery side required to manage the growing client base and order volumes. Our consolidated profit after tax from continuing operations grew by 31% quarter-on-quarter from INR 2.6 billion in quarter 3 to over INR 3.4 billion in quarter 4, making this our highest ever quarterly profit. Our FY '24 total gross revenues and profit after tax grew by 42% year-on-year and 26% year-on-year to INR 42.8 billion and INR 11.3 billion, respectively.
Period ending cash and cash equivalents increased to INR 98.4 billion on the back of increase in clients margin and cash generated from the business. Period-end client funding book grew to nearly INR 17.7 billion, compared to INR 11.5 billion as of March 2023. Consolidated net worth of the company grew to INR 30.4 billion. This does not include the recently concluded fundraise of INR 15 billion as the funds came in early April.
As we continue to operate the business within our desired margin profile, our FY '24 return on average equity remains healthy at 43.3%. The funds raised has been deployed as working capital into the business. The current quarter will have some elevated costs on account of IPL, annual increments and new stock grants, which will have an impact on the margin of the business for this quarter. The ROE post the fund raise will also see a decline before gradually growing back with growth benefits of deployment coming in towards the end of the financial year.
With this, I conclude the presentation and open the floor for further discussion. Thank you.
We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Swarnabha Mukherjee from B&K Securities.
Congrats on a great set of numbers. 2, 3 questions from my side. First, in terms of your broking business. So the major metrics, which is the number of orders we are doing in a day. If you could give us some idea in terms of this growth, how much of that has come from what you alluded in your initial speech that the number of days when expiries happening has gone up. So that must be one of the factors. What are the other factors we should have taken this number up for the quarter, including the client activation or existing clients ready more. If you could give some ballpark certification of that, that would be very helpful.
And Going ahead, what would be your aspiration to take this number? Because we have already seen a sizable jump in the number from where it was, say, in FY '23. And should -- can it be -- can we see a similar level of traction going ahead? What would be your aspiration if I were to ask you on that? So yes, so that would be my first question. And also maybe an addendum to that is that if you could also give some color on what proportion of this number of orders that are coming in is coming from engagement with BSE, that would be very helpful. So that is the first part.
The other things of the branding spend that you have mentioned, does this also -- I mean, is it inclusive of the IPL-related costs that will be there in the P&L, if you could give some color on that?
And We had -- sir, if you could also explain the pie charts in Slide #10, which you have highlighted. In particular, I wanted to understand that in the 2 cohorts that you have provided, FY '21 and FY '22, you have given a number which is close to 50%. So 54% for FY '21 set of clients and 49% for FY '22 set of clients who have transacted. So what happens for the close to 50% clients? So is there a scope of kind of accreting revenue out of them in the future? Or would they remain as inactive customers? And what broader message you'd like to do with this slide, if you could highlight.
Yes, sure. First, I will just answer in terms of increase in orders. If you see, when we started this financial year, we were talking around 42 lakh order per day, which in quarter 4 was 86. Finally, if you look, customers that we are acquiring was around 44, 44.2 lakhs per the month, which by Jen and said we were clocking around 10 lakh clients per month that we were acquiring around stocking, acquiring around, 10 lakhs clients per month.
So the new set of customers when they come in, definitely, they are active. And all that we get from our vintage clients and the new cores also are of a similar kind of nature. When they are on-boarded within 10 to 15 days, they are active on our platform. So primarily, it is because we have acquired a huge set of customers much beyond growth that we regularly clock and due to kind of like vintage and also being active on our customers, as you've explained in Slide 9 and 10, combined with new set of customers, we saw activity going up. And second, proportion of order of BSE, we don't disclose that. But that is not a significant proportion. It is proportionate to whatever order we clock on NSE and all that. It is not that BSE has contributed in a big way, although we have a decent market share across NSE/BSE and all other segments. On branding spend, yes, what we have shown, it includes IPL. Vineet will be a right person to walk you through this number.
And on Slide 10 specifically, Amit or Vineet, you can take this question.
Sure. So for now on the IPL spend, as I just spoke in the commentary, we spent about INR 22.7 crores in quarter 4, specifically in the month of March. This includes the proportionate share of the sponsorship as well as the spend towards media and digital adverts. So as you would be aware, we've won the bid for INR 82 crores annual bid for associate sponsorship. This what we are doing is we are spreading it across all the matches. So there are about 74, 75 matches to be held in IPL this season, of which about 13 were held in the month of March.
So the proportionate share of that 82% towards the sponsorship cost has been booked in the month of March, along with the spend towards digital and media adverts. And the balance, plus the spend towards digital and media adverts, would be spent in the month of April and June across the entire season. That would be roughly in the range of about INR 1.2 billion or INR 120 crores.
Okay. So the remaining amount would be INR 120 crores, so nothing additional apart from the IPL?
Yes. On the IPL front, this will be the total spend. And thereafter, we will continue to spend on our brand as we do as part of our general spend.
All right. So sir, just to clarify one. In Slide 9, you have given that for FY '24, branding spend was around INR 88 crores. So that number for FY '25, we can take INR 120 crores. That would be correct understanding?
That would be INR 120 crores only in the first quarter. This is across IPL. And thereafter, so what you can do is you can reduce INR 23 crores from INR 88 crores and spread it over the balance, say, 9 months to 10 months to understand what is the spend every month going forward in the future.
Okay, sir. Got it. So understandably, sir, on this -- the margin outcome of 1Q would be, I mean, lower compared to your guided ranges. For the full year, are we confident to remain in the guided range? .
Yes.
So as I said, this elevated cost is going to be in quarter 1. But as we go through the entire year, the margins would be in the range of the guided range. And that's where we always advise our analysts and investors to look at our business from a yearly basis and not on a quarter-on-quarter basis.
Just to add over here, this branding cost and when we are acquiring more customers than what we acquired in previous quarter, it will appear there is an impact. As I always said, this is kind of an upfront cost.
So -- and if you refer to Slide #9, we are clearly showing that all vintage customers across 5 years have given us revenue. So best would be that when the time this phase of growth continues and we are hopeful it continue for many more years, whenever in a quarter, we acquired more than what we acquired 2 years quarter, there would be -- that will appear there's a suppression of margin. So that's really upended costs, which you have to, if at all, you want to know, annualize kind of an OPM that will help you to remove for timely.
If you are taking it, you divide it by 5 years because you portion 12.5% of due costs that we have taken. These lifetime value open customer as shown in Slide #9, it is 5 years and beyond. So this is all costs that we are taking apprehended in terms of acquiring more customers and getting more market share is making our business model more stronger.
Right, sir. Got it. Sir, on the aspiration in terms of number of orders per day, if you could give some color?
No. Like as I said that in this time, we are able to acquire more customers and we are able to get revenue from our existing customers. The number of orders will grow. Now the given number would be like getting into forward-looking statements.
Okay. understood. And if you could take my last one.
Yes. Swarnabha, so Amit here. I'll perhaps help you understand that slide. So are you able to hear me clearly, Swarnabha?
Yes.
Okay. So there are a couple of messages that we are giving out here. One is if you do the MAC headline active plant that you usually get to see at the end of the month with LG publishers, you will see that on average, engine is about 27% to 28% active customers who are active on any given day in a rolling 12-month period. So that's the data that you see as a headline number.
What we are trying to convey is that, that is not the right way to look at the active customers. The right way to look at it, how many unique customers are active over a longer period of time because not all customers become active in the year in which they are acquired, and they begin to test the market, they begin to test the platform, test the process, the journey and then they slowly begin to get active.
So this slide that we are referring to actually shows that for an FY '21 cohort of customers that were acquired, close to 54 customers, 54% of them became active over the next 4 years. And we looked at that for the subsequent year 2, for the subsequent year cohort customers. In fact, in the subsequent year, close to 50% customers became active in the 3 years that, that cohort existed. This implies that directionally, it can be far more than 50% because all these customers become active over time. And that is the power of the platform that we are trying to convey so far as the engine is concerned.
And in that context, too, the other that we wanted to convey is, even for customers who are doing futures as options, over time, after having understood the market well begin to carry out long-term equity investment. And therefore, this slide actually shows almost all the F&O customers, and there's a very small portion of an F&O customer who have not gone into equity as an asset class. But an overwhelming majority of them, even so they go into equities, build a portfolio and therefore, stay consistent on the plan.
Now even these customers, even after doing F&O, because they have bigger equity portfolio, once they have tested the fact that when they do long-term investment, moneys grow. At the same time, they're now going to remain sticky on our platform when it comes to engaging with that customer. I hope, Swarnabha, that we are clear.
Yes. Sir, just 1 point. So the data shows that the situation that the account for number of customers in only cash is higher than what it is for [indiscernible]. So does that mean that people who are coming in a large part will actually only do cash and not F&O? That would be -- am I getting it right, sir?
So customers who -- the journey here is that, well, majority or at least some portion of our customers, when they come on our platform, the first point of engagement could remain in F&O. But eventually, they will also have equity. What this shows is F&O and equity. So the blue portion is actually F&O and equity. So around close to what, about 25% or 30% of them are F&O are also doing equity. And close to another about 40%, 50% of them, 40% of them are actually doing all the equity. So the point is not everybody is doing F&O. People who are doing F&O are also doing cash, and people who are in cash are only doing cash.
Okay, sir. Got it. Got it. I'll maybe take this offline to understand this in the future.
Sure. Sure.
Yes. I just maybe 1 quick thing. There has been some news flows regarding regulators looking at the F&O space. This has come quite several times in the last 1 year. But any conversations you were having in terms of risk management of customers from the F&O side, if you can give some color?
Currently, if you see there is think concrete whatever, like a discussion we are having with regulators that has been implemented, and that is something like does not clearly concerns because there mostly focus is on not to do a customer not to kind of show long loss and profit statement and all that. I think that is quite old use now. There's nothing new that I have heard about.
[Operator Instructions] The next question is from the line of Sanketh Godha from Avendys Spark.
Sir, I'm listening to Slide #9 and the cohort analysis, what you have in. See, if I do a simple math there, the revenue earned in that year where you acquired the client and do revenue per client in that particular year, then I see there is a structural decline in the revenue earned per new client what you acquired. If I do the math, that number is INR 1,860 for FY '20. That number is INR 700 for FY '24.
Sir, just wanted to understand that incremental clients, what you are adding, the marginal revenue they are bringing is leaning for the lower compared to what you are adding in FY '20. Sir, just wanted to understand that client addition really matters from a revenue growth point of view. Because incrementally, the revenue addition seems to be much lower for every client you had. That's my first question.
And the second question that I have is that with respect to [indiscernible], so client you raised nationally, it will result in a reduction in the working capital requirement. So I just wanted to understand how much borrowing costs will further come down in FY '25 going ahead with the first capital coming in.
And lastly, to Vineet, if I understood it right, INR 120 crores is what you will spend on PL. And that number will be a recurring number for next 4 years. That's the way I need to look at it, right? These are my questions.
Okay. So let me answer the first one. See, on a related basis, always that you acquire a new client or new tales or a new demography, always it takes time to optimize it. So what we look at is not that, okay. We want only customers who give like very high revenue. What we look at is what's the cost to acquire a new set of customers. And if that fits in our model, where we say that whatever cost we take to acquire this customer would be able to give us an open of around 50% to 60%, we would like to go and expand. That is how all digital players have expanded market share.
Traditional bookers were stuck with high ticket size. But we thought that we can go into new territories, acquire those customers. If it is profitable, if the unit-wise economy is favorable, we should go and acquire those customers.
So if you look at demographic change, which has happened across the year, we are now acquiring customers from Tier 3 and beyond. We are acquiring customers who are young millennials and gen z and all that. So these are new set of customers who are getting exposure to capital market.
What we look at, if you look at our margins and all that, this is how we have expanded our market share, and there is a stickiness of the customer, whichever year we have acquired. We continue to be on our platform for next year, following years, and we are able to cross-sell many products.
So right now, it's too early to say what would be a lifetime value of a customer where we haven't sold all the products to this customer. What we look at, what the cost of equation and what the lifetime value of a customer. With this cohort that we are acquiring also shows that lifetime value of a customer will be around in the region of 7x.
In digital model, I feel that up to the level of 5 [indiscernible] also, we are profitable and we can maintain these margins. With that approach, every quarter, we see what are the new kinds of areas that we can get into. This process has been going on since last 3, 4 years.
So we try to get into new kinds of like channel, new kinds of demography, new course and acquire customers. And what we see across here, they're able to give us a decent OPM. So we would not look at related basis, we look at absolute basis, what's the cost, what's the revenue.
A follow-up on that, Dinesh, but just a small clarification. So the number is INR 700 per gross client today. So any number below which you believe that it is unviable to acquire more clients, maybe say INR 400, INR 500. Is it...
INR 700, actually, whenever a year completes, client has not completed 12 months. That's acquired in the later quarter. Some quarter, we acquired, not this quarter. If I look at 12-month steady-state content revenue, there, we don't see any content like big deterioration or big concerns.
Got you, sir. Maybe if you can answer.
On your question on QIP, Vineet QIP and IPL intake?
So Sanketh, on the funds raised from QIP, we've raised about INR 1,500 crores, and this will be deployed across margins with the exchanges and to grow our NPA book. .
In terms of the finance cost, that is a subjectivity based question because with the growth in the business volumes, the growth in finance cost will be there. But I would tell you that it would be in that same range of what we have spent in the last quarter as a percentage of the gross revenue, it's not going to be very different from that. But again, it depends on how we grow our client funding book and the volumes or the orders growth that we see for the current year. On the IPL cost, the comment...
Just I would like to add over here. Sanketh, this QIP was not to debt. It's the book capital. We can see a huge growth, and we would like to deploy this capital for the growth of the business, may it margin trading book or including orders and all that. Yes, in particular.
Yes. On the IPL, the committed cost for the next 4 years is about INR 82.5 crores annual. And beyond that, whatever we are going to spend on digital and media adverts is over and above that. For this year, you are right, we have committed to spend almost like INR 143 crores, INR 145 crores over this entire IPL season, including the media adverts and digital ads.
Okay. Okay. Sir, small clarification. INR 1.2, INR 120 crores is excluding INR 22.7 crores you have already spent in fourth quarter, right? So for the full year, the cost will be INR 120 crores?
No. The cost of this entire IPL sponsorship and related advert spend is INR 143 crores as we see it today, of which INR 23 crores has been accounted for in quarter 4 and about INR 120 crores will be accounted for in the current quarter.
The next question is from the line of Prayesh Jain from Motilal Oswal.
Congrats on a good set of numbers. Firstly, sir, like the spend on IPL, now we've already almost in 1 month of IPL, how has been the impact of the spend that we are doing on this? Is it better? Is it the experience is better than what we had thought or what we were doing how has been the experience so far? That would be my first question.
Second, in fact, just following up on Sanketh's question earlier. So if you look at that run rate has come off from 18, 60 to 700. And even in the second year, when we look at it, it's come down from 3,400 to 1,500. For third year, again, it's down from 3,000 to 1,600. So that has been the declining trend. Whether is this a phase? Is this something where possibly, this is a number that we should look at? Or is there a scope for this to further?
So the point that I'm making is the customers that we would have acquired in FY '24, about 8.8 million, they have given around INR 615 crores of revenue, and so that's 700. So what would be the trade, number of trades that they would have given, whether that is a number that we should -- is kind of achievable or possibly further more downside and we look at on this number.
And lastly, just a clarification. If you can give on the presentation, Slide #10, what do you mean by realized equity gain of INR 5.5 billion and realized equity gain of INR 18 billion. Could you just clarify for FY '20, those were my questions.
Yes, Jain, thank you for the compliment, first of all. And now coming on IPL spend, although it is 1 month, but like broadly, we are looking at increasing visibility of Angel One across Tier 3 and beyond. And IPL is the best media to really see a jump up in terms of continuous recall or maybe people recollecting Angel One as a fintech player.
So benefit of this would be a bit long term. I would say this will take some time for this visibility to kick in and result in some good numbers. But what we are seeing is that now, when we are running our digital campaigns and all that, except it and kind of like recognization is very high. And we believe that this will result in some business numbers.
And for us, it is important to be visible across all time. Because mostly customers that we are getting is from Tier 3 and beyond. And cricket a very popular sports across all gender, across all each age group. So initial numbers are showing a [indiscernible] like visibility benefit that we have got. So we believe this will boil down to business numbers. So that's the main objective that we went for IPL, to get a good like recall and top of the mind recall from audience who was looking at digital stockbroking.
So digital, this is what happens?
There is space for 3 players. So we want to see when a customer, a prospective customer is thinking about stock broking. Does he recall our name on the top? That means we will get a market share of 30%, 40%. He actually has to you recall that, I mean, at least top 3.
So the lead indicators, which will help us at, okay, when this population of people who are having an account, Internet trading, Internet account and all that, which is around INR 50 crores to INR 60 crores. When they think about stock broking, are they thinking about Angel One? if the answer is yes, then of this huge revenue pie that we are going to see in the next 5, 6 years, by default, there's a leading indicator to suggest that 3 -- like from 1 out of 3 is recalling Angel One name. So that is the purpose of this IPL and trading.
Okay. Now coming to your FY '24, the way you're calculating we acquired INR 8.8 million, but revenue of this customer did not come for all 12 months. Okay. so if you see our most of the acquisition has happened in December, Jan and Feb. So they haven't contributed a total 12 months. The way to look at is that as lead in kind of like parameters of data sensing, what's that if you are getting this kind of like revenue in first month, second month. So they extrapolate what kind of a lifetime value or will get when the complete 12 months. And we have been perfect modeling that to the tune of like error of 1.5%, 2%.
So clients that we have acquired clearly shows that they are profitable and they will fall within that bracket breakeven of 6 to 7 months. They'll fall in the bracket where you'll be able to get an OPM of around 50%. So that is our main objective, to be very focused on business metrics. As a new pocket opens up and we see there is a huge potential in terms of increasing lifetime value, and our data center is able to extrapolate that trend. So we try to spend early, and we have been doing it since last 3, 4 years. That's the secret source that we were able to be successful in the digital model.
Now we have perfected that modeling to an extent if we acquire a customer, we are able to predict what kind of revenue we'll get in the next 12 months. So then we work on digital. It fits in our OPM and take you in clear and all that. We go aggressive on that market share.
On Slide #10, Amit, you would like to take it forward on that?
Yes, I'll do that. So Prayesh, on the Slide #10, what we mean by realized gain is these are customers who have traded in equity or at least bought an equity and then sold in the course for the last 4 years. So those customers who were acquired in FY '21, in the 4-year period that they had been in existence on our platform, some of them would have actually sold their portfolio in the course of 4 years and some have continued to hold the portfolio as of March 31, 2024.
So the realized equity gain is that part of the gain that was bought and sold in the course of the 4 years. The unrealized gain is those that are getting held, continue to be held as on FY '24, and that value of the portfolio is actually worth INR 66 billion and a gain of INR 24 billion of that INR 66 billion. The INR 66 billion includes the gain of INR 24 billion.
Got it. But sir, when you say INR 7.4 billion, does that include only cash portfolio turn? Or is this also includes F&O? Or these are clients who are doing both F&O and cash, right? So would that mean that they would have also owned some profits on F&O and combine our possible combination of loss in F&O and to gain some cash. Is that the right way to think about it?
No, Prayesh. So the purpose of that is to say that there is a realized equity gain. It's not about F&O. It's pure equity gain. The intention here is to say that customers who are doing F&O are also doing equity, and they are experiencing gain. That's the purpose of this slide.
So the reason is that, okay, like there is a concern in the market that people just do F&O. What we want to say is that this young population is always attracted towards money and not that once they're unable to achieve something subscription F&O, they stop investing. They move towards investment.
And once you move towards investment and you see some kind of like profit, be sticky on our platform because. Across all that content like life cycle, when this person is thinking about saving instead of going to a bank and putting money at 6%, this person has seen the benefit of equity appreciation. This person will remain and put all that lifetime saving in equity market if they learn how to really deal with mutual funds, equity portfolios and all that. So we are seeing early signs where we are seeing customers who started the journey as a trader are also moving towards equity and creating a portfolio.
The next question is from the line of Nidhesh from Investec.
On the corporate structure changes that we announced in the 1 or 2 quarters back, is there any update on the regulatory approval of the corporate structure changes that we are planning to do?
Vineet, you would like to take this question?
Yes. So no, we are still engaging with the regulator in terms of making them understand the entire structure. So no update as of now.
Sure. Secondly, what is the guidance for EBITDA margin? Are you saying that we will be in the guided range of 45% to 50% for full year FY '25 even counting for even after counting pricing cost?
SO now over here, like as we -- as I said that if you look at like increased costs in acquisition and cost [indiscernible] IPL, it has a huge benefit. But if we struggle for 12 months, we would be within this range of 45% to 50% OPM. And only impact would be other businesses that we are building that can have an impact of around 1.5%, 2%. Vineet, you like to elaborate that?
Okay. So what we emphasize is that we will be in that range of about 35%, 37% for the next year, but there will be an impact of about 1.5% on the new businesses that we are building across AMC and wealth. So you can take the average margin profile to be in the range of about 45% for the next year, 43% to 45%.
Sure, sir. Lastly, the new businesses that we are in, how do we think about some medium-term perspective, let's say, 3, 5 years? What sort of contribution of all these new -- excluding broking business can contribute to our P&L?
We see huge content synergy and with all businesses that we are building are complements to what we are doing until now. So when we're talking about acquiring customers, as we look at the prospect, if you look at that we should be -- our services should be available across all segments, be it mass, UHNI and all that.
So it will take its own time for us to build all that businesses to a level where you say it will have a contribution in terms of revenue profits and all that. But all said and then, we are seeing a huge opportunity in both the businesses, particularly wealth management, where we have got very senior kind like co-founders who know their business, and we are excellent at in terms of technology and all that, we see a great future. But for this 1 or 2 years, I think broking is doing extremely well and it makes sense for us to invest in future trends.
But any number you want to put this out as percentage of revenue may come from the new businesses?
As you said that in terms of expenses, this will have an impact of around, say, 1.5% on the OP margin. But in terms of building a business too early right now, second would like to give a brief on this wealth management.
Yes, Dinesh. Business sort of question that Dinesh mentioned, a very early stage. I think the things just sort of come on board about 1 month, 1.5 months back. We do have aspirations to create 2 large verticals. One is to cater to the ultra high network. In other words, $5 million plus, which is something that the team has almost 2 decades of experience in sort of take into.
We believe that there are huge opportunities available there in terms of cost overhead that can be brought down. using technology, and this is one of the reasons where we are super excited this part of the seed, which is very efficiently use technology. And the second, which I think is where a lot of this also for all of us to create, is affluent the energy merchandises we call, where there is a lot of available for us to take all our trade and cloud that we have taken so far for the [indiscernible] to the next level of emerging race in India.
And I think that reach, and this is not possible if we don't have the right domain and right tech. And that is how we are trying to build. As far as some guidance is concerned, very early days, I think over the course of some of the other calls that we will have and we interact, we will have a little more by them. We are also awaiting the necessary regulatory approvals to come in place before we hit the rubber on the road. So will keep it posted.
We'll take the next question from the line of Jain Kharote from Jefferies.
Two questions. First is on the IO market, broader market in general, [indiscernible]. We've seen a lot of SIPs are sort of increasing if you track the NHT market for the share of colocation, these trades is now almost 60%, 65% in the Equity Derivatives segment.
The other -- we are seeing the related crop rates were making profit, but retail still got to keep some. But with the FT sort of increasing and the outlook is much, much larger players coming in the market in the next 1 or 2 years. Do you think the retail profit pool can shrink meaningfully and then the spread on these 5 products can come off meaningful and that will have, of course, a knock-on effect on overall retail volume? So would love to hear how is your view of these 2 problems, specifically because MSC is also adding the data center in the new base? So that will open up much more co-location track. There is a regulatory sort of arbitrage between having access to those export retail unit. So just wanted to you on this one, and I'll ask my second question after that.
See, when we look at F&O, there are 2 sides of [indiscernible]. One side is retail, retail, core retail, and second side is HMI, HFT and FIs, who are putting that phase. So when we are talking about retail, second leg is executed by this player, what you're talking about, HFT or whole location or [indiscernible] FIS.
So retail is not impact. You see market share of retail, almost it has remained constant. That does not fluctuate in a big way would be in the region of 45% to 44%. So we take a part of market share from this segment. We are not into a shifting. We are not into coal efficient business. We are not into kind of unlike [indiscernible] desk. So Whatever volume you are seeing, it is purely because of retail participation.
So what we are seeing is that retail in India is really taking loss of interest. They want to participate in capital market. And when they are participating, that is a segment that we are aiming at, and we are seeing that we are able to increase market share.
But if you look at retail, what is needed to come in this market. We are saying you need an Internet connection, smartphone or any other device, and you should have a telephone and regional saving that you can start your journey investing in equity markets. It can be as low as INR 500,000, INR 2,000 standard SIP mutual. Slowly as you progress in your life, they tried out different, different segments, F&O, cash, commodity and all that.
So we are seeing a huge opportunity, but potential is huge. Now when a larger player comes in this market, they enable larger market. They enable wider market to come in and participate. And we, as I said, that being recognized as a fintech player where we have a kind of incremental concern like market share on this incremental acquisition that we do to the tune of 23%, 24%, we are beneficial. Because our model is very different.
Customer on our platform slowly evolves to higher site and move towards kind of like are on net equity, mutual fund or maybe later on go towards wealth management product. So we feel that introduction of larger there is going to help expand this market. When we have such a big population we have reasonable savings, what's the reason they're not going to the equity market?
Because of the lack of awareness, but they are concerned about lots of things which must have happened in the past. So we always feel that a new player coming in with a big budget is going to expand this market, and that is going to help us increase market share. And on your first part.
Dinesh, sir, your audio is not...
Yes. Can you hear me?
Yes, I can hear you now. Please proceed.
no, I have completed my answer. Is there anything...
Actually, my question was more about product profitability. Because we have limited products in the F&O market, right, 5 products. So because I was more worried that the product profitability of the spread will become so thin that for the retail players basically, does this lead to fatigue?
No. Currently, we are not seeing any kind of like price pressure or any fatigue in terms of product that we are offering. The retail is just playing on like direction of the market. They buy all or sell in buy put. Beyond that, that activity is limited. So what we do is that we try to design certain kind of like product journeys, where they are able to understand this better.
When it comes to pricing, I don't think there is any price special. In fact, there's a kind like opportunity for us to charge for cash segment. Right now, we are looking at a revenue that we get from customers that are on-boarded. It's quite decent [indiscernible] to justify our cost. We are not charging on cash segment.
But if you want, we have a huge volume on the cash segment. If you want, we can charge it also. One of the competition or fewer companies, in fact, are charging on cash segment. But we are seeing there's; a huge campaign that is generated to other segments, we are okay to bring back the 0 price.
Okay. Sir, second question is, if you can explain the journey on the bank guarantee replacement. How has the -- if you can tell you [indiscernible.
I'm unable to hear you.
Sorry. Am I audible, sir?
Yes.
Yes. Sir, if you could explain what is your average daily clearing margin with the clearing corporation? What is the mix of bank guarantees in that? How much has been replaced? And then how is the journey over the next few quarters?
As we said, this was raised for growth. It was not for the replacement of an instrument. But Vineet will be the right person to take this question.
So our current bank guarantee deployment across the clearing corporations is about INR 2,800 crores. And apart from that, we also avail intra facilities for the time differences for the settlement with the exchanges.
Sir, 2,800 crores is fully own funded now?
Yes. Since September of 2023, all bank guarantees that we have been deploying in the business are own funded.
Okay. Sir, sorry, just squeezing one last thing. This panel that the government is setting up with RBI. There is some concern that the bank guarantee limits may be sort of difficult to get from banks. Anything you're hearing for our banks being a little more cautious in an extending limit?
No, we've not faced any kind of difficulty in availing bank guarantees.
The next question is from the line of Pallavi Deshpande from Mitra Capital.
Yes, sir. Just wanted to understand on the -- we've seen on the AMC side, the peers go ahead. I mean, I understand it's the approval side. So [indiscernible] approvals, and that's why I just wanted to understand because we've been leaders so far in everything.
Is [indiscernible] there on the panel right now? [indiscernible]. Sorry, can you repeat the question? We couldn't hear you.
Yes. So just on the AMC side, I understand you mentioned about some approvals pending. But we've seen our peers actually launched that ahead of us. So wondering were we late in filing the approvals? Are we behind them and filing them? Or how exactly how it has happened?
Yes. So see, on the AMC front, we are currently undergoing the process of getting the approvals. While there is no regulatory tax on when we'll get the approval, but I can just say that we are progressing well on that front. With reference to competition. See, I would not like to comment on any particular player. But let me tell you, as compared to the general industry trend of getting the approval, we are very much in line with where we are progressing currently. And so nothing much to disclose on that front.
Right, right. Second was on this -- you mentioned about the realized gain slide, where you mentioned about the client making. Is that post brokerage or pre brokerage? Equity gain of INR 5.5 billion for the F&O line.
Amit, do you like to take this?
Yes, I'll take it. So Pallavi, this is the net realized gain. This is after all expenses for the customer. So the customer has made a net gain on this portfolio. Either he has realized it by selling off and therefore, it is called realized gain. And if he has not sold it and holding it, it is called unrealized gain. So it is the gain to the customer after setting up of the cost of acquisition of those assets.
Right. So after the brokerage expansion?
Yes, these are all post charges.
Right. Okay. Right. And just lastly, this is the last question. So on the addressing spend, we've seen a significant ramp-up even excluding the IPL. This triple spend excluding IPL. So I just clear, could there be a regulatory backlash given this very high already listing on the IPL side?
I mean, we were always below average spending on branding and all that. So if you look at like the last few quarters, it has been almost like been constant, except for we're getting into IPL sponsorship.
Right. Now just given how much concern was there by [indiscernible], I mean, like you said, there's nothing much they can do. But given the concerns that it create.
There is no restriction like that.
The next question is from the line of Dixit Doshi from White Stone Financial Advisors Limited.
First question is on the Page #9 presentation, where you have given the vintage clients. So you have given the margins, excluding the branding spend, it's more or less flat over last 3 years. Can you give a margin excluding the branding and the client acquisition cost. Just to understand that once the vintage clients revenue comes, the vintage clients margin is how it increases over the years? That's my first question.
And secondly, on the wealth management, so you have mentioned that the cost will increase next year. So will our business be similar to the other wealth management companies where we'll be having a large pool of RMs and the physical is more of an offline business or being a technology player, we'll be doing something differently on the wealth management side also and leverage our technology and also our existing 22 million customer base. That's my 2 questions. And just 1 small bookkeeping question. What will be the retail cost next year?
So on sales costs, we don't really disclose the sales cost. But I think we have been incurring this high sales cost in many quarters. that will give a great sense in terms of what our open has maintained across all these quarters. Maybe there is a comp when we ramp up our sales. There is some conception. But as revenue kicks in, we have seen that margin will better.
Branding is certainly because of the new exercise we are doing. So for all analysts to understand that, okay, what is this cost so that you all are aware that how this would be shaping up in maybe 3, 4 quarters.
So vintage-wise clients already, we have given kind of like what kind of revenue we can get. So you see kind of some like very less drop in customers we acquired even pre '20, FY '21 and FY '20 and '21.
So if you take the sales force, as you say, this chart clearly shows that there's a lifetime value of 5 years and beyond. After 5 years already, you can see the data. So what the sales costs you do, it doesn't be a portion for 5 years. But exact numbers, we don't reveal. So I would not be able to help you on that. On wealth management side, I will ask Srikar to take it over. But [indiscernible], if you can give you more clear.
Yes, sir. So for the next financial year, our budget for the ESOP cost is about INR 100 crores, of which about INR 50 crores, INR 52 crores is the carryforward cost of the shops that have been planted over the last 2 or 3 years, 3 years, and about INR 50 crores will be the cost, which will be incurred towards the new brands that we are going to do in this year.
If you can take model and differentiate it.
Yes. In fact, thanks for the question. I think it's a fair question. But in terms of your question also alluded to the answer, the answer is here. We stated a deep integration between domain intact. I think at least, we believe the next 5 and 10 years, the right to win in the ever-expanding wealth management landscape will be leased by people who can invest alleging a way. There is a day technology to much wider space.
I think end so far has been more about going deep. We at least in India we believe that it will now have to be played both in terms of debt, which is where high quality remain is fun and in terms of it, which is where technology comes. So example, there would be over the next 3 years, many products that could be available in a fractional manner. We've already white paper close around fractional REITs. We are already seeing similar utilization across products.
So why the team has a deep insight on what the clients require, and we will continue to service that. We will use technology for that space to bring OpEx down. Because one of the things that we see is most of the cost model for current wealth management funds are built keeping in mind revenue models, which are completely changed.
So revenue model that over periods of time being disintermediated, have moved from upfront to a very [indiscernible] this kind of revenue model. So we believe that the usage of right technology can enhance productivity. But we also think that large investors might not be 100% ready to fully consume everything without high-quality [indiscernible].
So we and sage the right mix of an omnichannel kind of a requirement for a client. And the next customer segment, which would be HMI and the affluent, we will be present in both, or at least that's the plan, in terms of having good quality RM, dispensing good quality wealth services, and also using the technology leverage with the parent partners here in Angel One create interfaces across that and so, which is able to give customers the right services. So the idea is a right mix of domain intake to be able to capture both [indiscernible].
Next question is from the line of Aditya Sharma from Aditya AMC.
Just wanted to understand the MBS book has declined quarter-on-quarter from INR 1,980-odd crores to INR 1,770 crores, while the market has been buoyant and especially the cash market has been quite buoyant last quarter. If you could just help us understand, I know it's a balance sheet item, probably it was reflecting on the date, 31st March. But I just wanted to understand the reasons for the decline.
Yes, sure. So MTF book was also rising proportionate to our customer base and the volume that we did in terms of number of orders. But as we realized that it is going to a point where we need more capital, that is where we have put restrictions on customers who are reading this margin tailing. So that's the reason we did quite an all that so that we are well capitalized to ride the trend of kind of like growth in this NPL book. So we took a cost now we have restored back to normal, you will see a growth in MTR going forward.
Okay. Okay. Any aspirations from your side in terms of in next 2 years, can we do around INR 3,000 crores of lending in terms of NPL by the end of FY '26. Is that a reasonable assumption to make?
Yes, it is the assumption. So like only, as I said, that, that said, we were around INR 2,100 crores, INR 2,200 crores of NPL. So to get that INR 3,000 is like possible. This is not a difficult target. dl[indiscernible] Espacio target will be higher than that.
Sure. And also, sir, in terms of margins, when you have provided the breakup, so there has been significant improvement in terms of the margins from the AP business, so around 60-odd percent. So just wanted to understand if -- what's the reason behind? And is it something structural? Or is it just for the quarter?
No, no. It's just structural. I think I would ask Nishan to reform the OP business.
Yes. So what has happened is that we were essentially having an omnichannel play, whereby a lot of engagement with our existing sub brokers was through digital means. And we were also last year, largely not acquiring new sub brokers.
So any expense on account of sales would not have happened. And therefore, what you're seeing is a slightly, I would say, exaggerate version of what the usual margins would look like. Going forward, as we kind of start on-boarding new sub-brokers, and we started incurring some of those costs. Plus, as we unlock new regions, in particular, rest of India, where the existing presence or the existing contribution to the revenue is not that strong.
I think some of these costs would also come into play and therefore, the margin that you're referring to would kind of sober down a bit. But yes, overall story is very robust. -- and we would continue to kind of just the similar momentum that you've seen last year forward.
Got it, sir. Just a follow-up on this. So how are we progressing in terms of the AP addition? If you could share some bit of color on that, that would be helpful.
So there has been a very, very strong interest ever since that we have restarted that process. However, we have been a bit choiceful in terms of the kind of partners that we would like to engage with. -- we have kind of enhanced some of those screening parameters and ensuring that people who are coming on board are coming on board with a certain persona.
And therefore, the idea is that going forward, we would like to onboard higher-quality sub brokers and who can be kind of contributing meaningfully to the client addition and be a long-term partner along with us.
The next question is from the line of Arvind from Sundaram Altering .
I would have to understand like what are our aspirations into a in terms of client addition maybe for the next few years? And what is our aspiration in terms of improving tax to make the client act of like just how mentioned in the call, it was mentioned in the call that 50% trying to become active in 5 years now, like it has come down for 3 years.
[indiscernible]. Can you just...
Sir, Mr. [indiscernible] request. Can you use your handset in that case, please?
Yes. Okay. Can you hear me now? Is it better?
Yes, sir. Please proceed.
Yes. Sorry for the [indiscernible]. What is your aspiration in terms of client addition? And what is our aspiration in terms of improving that to meet the clients act to like how the client is becoming used to be like 5 years and now with the comfort of 3, 4 years. Is there any move -- is there any further improvement possible there? And what are the aspirations in lending and deposit business that we have mentioned either in terms of penetration among existing clients? Or are there any aspiration in terms of disbursement by FY '25 and '26? And another question is on considering the IPL acquisition for 5 years, will this expense will recur for the next 3 years?
Yes. So our aspirations on this client addition, as we always say, being the digital player, you would aim to get a market share of around, in new equation, to the tune of around 35%. That is where we feel that a digital player should only ship themselves.
So there's an aspiration kind of like we have at whatever clients you can come to market, we should be aspiring to get to that market share. Progressively, we are inching towards higher number every quarter and back. So that is a positive thing.
In terms of offering customer a multiple service, we believe time has come that we have to leverage our like super app platform, where we offer multiple services to customers to increase their lifetime value and engagement on our platform. So because of that, we will see lots of kind of an active customer.
If I refer to Slide #10, we have clearly shown that when we acquire a customer. Across yes, they recover on our platform. So Amit, if you can take that point, that would be helpful. One sec.
On lending side, so you can take that platform. And I was just completed IPO and then added over to Amit and [indiscernible]. On IPL, it is not about recurring cost. It is about, as I said, that we have an aspiration to acquire -- to get a market share of new actuation to 35%.
And as I said, in digital business, lead indicators are that what can recall we have for your brand. We want to see, we do lots of surveys and exercise to see our spontaneous recall for our brand and top of the mind recall when we are asking them, which is a broking comp, we are going to open. So there should be Angel One name in that. That's a great indicator that we will be able to reach that market share of 20%. Because IPL is more about visibility, about that recall, about that spontaneous recall that people should have. If they are thinking about stock broking, Angel One should come in their mind. So Amit, you can take over for this activity of customer.
Arvin, so as I understand, I guess you also want to understand how the customers will evolve over time, right? If that is the question, then this slide actually says that in about 4 years' time, not just -- I mean we are comparing this to or we are actually kind of, I think, the discussion towards the active customers. And we have said intending what MSC reports as the total number of customers were active in a given year, what we are seeing that when we see a certain cohort of customers that we acquire in a certain year, how many of them how many unique customers of them actually become active over a period of time.
And therefore, this data actually represents that in FY '21, whatever customers we acquired in this case, 2.4 million, 54% of them became active over a period of 4 years. And so when we now revisit this data in the following year, I'm sure we will see a larger number there. And similar is the of the subsequent cohort of customers that we acquired. So I hope that advances your question, Arvin.
Yes, sir.
Okay. Arvind, I'll give this to [indiscernible] up to address on the lending and deposits aspirations.
I think your question on lending is what is our aspiration in the next couple of years, right?
Yes, sir.
Lending is largely the biggest area in financial services in India. And we also have very high aspirations there. At the moment, we are in beta testing phase of the lending product and the experience for our customers. And as soon as we are out of it, we'll start to aggressively build this vertical in the next 2 to 3 years. You should see a very large lending player from our side.
The lending is recently. And in terms of deposits also, I think most likely this quarter or early next quarter, we should be out with our deposit offerings. There will have tied up with few banks and NBFCs to offer their corporate bonds and FDs.
Sir, any numbers you can give in terms of penetration you would like to see in few years or like the quantum of business you would like to see?
So this question is pertaining to overall penetration, right?
Yes, especially with respect to new business, yes.
New business -- yes, yes, sorry.
Mining the existing client [indiscernible].
I think as of now, we are still in the early stages of the business, right? The aspiration is quite large, but too early to give out a number right now in terms of penetration that we make.
Yes. And just 1 clarification. So I understand the IPL [indiscernible]. I understand that is important. I'm just trying to understand will the take a [indiscernible] like continue for like FY '26 also rate. That's what I'm trying to understand.
No. See, if you look at IPL spend as our base, revenue will increase. So this trend would be a very small amount compared to what we are spending today. We are spending this so that we are able to gain market share.
So when we see our growth rate and if this organized becomes 3x of what we are in 5 years, the IPL spend would be quite small and insignificant
Ladies and gentlemen, due to time constraints, that would be the last question for today. I would now like to hand the conference over to Mr. Dinesh Thakkar for closing comments. Over to you, sir.
Thank you for joining us on the call today. I hope we were able to answer your queries. Should you require any assistance, please feel free to contact Hitul Gutka, Head of Investor Relations; or SGA, our IR advisers. Good day.
Thank you, members of the management. Ladies and gentlemen, on behalf of Angel One Limited, that concludes this conference. We thank you for joining us, and you may now disconnect your lines.