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    5Paisa Capital Limited

    5PAISA
    Financial Services·10 Oct 2025
    Management Summary

    5Paisa Capital reported a mixed Q2 FY26, with strong operational improvements despite challenging market conditions. The company achieved a 20% QoQ increase in new customer acquisition and reduced acquisition costs by 15%, leading to a 25% improvement in first-year revenue. Total customer base surpassed 5 million, and average daily turnover grew 18% QoQ. However, PAT declined 18% QoQ to INR 9.48 crores, and total income remained flat at INR 77.3 crores, impacted by industry-wide volume declines in cash and F&O markets.

    Highlights

    8

    • New customer acquisition increased by 20% QoQ to over 95,000 customers.

    • Customer acquisition costs reduced by 15%.

    • First year revenue (FYR) improved by 25%.

    • Total customer base crossed 5 million (50 lakh).

    • Average daily turnover rose 18% QoQ to INR 2.6 trillion.

    • MTF income grew by 22% QoQ.

    • Average client funding book expanded 17% QoQ to INR 364 crores.

    • Mutual fund AUM increased to INR 1,647 crores, up 4.7% sequentially.

    Concerns

    5

    • PAT for the quarter stood at INR 9.48 crores, down 18% QoQ.

    • Total income for Q2 FY26 remained steady at INR 77.3 crores, broadly in line with previous quarter.

    • Cash market ADTO declined 16.7% QoQ to INR 39,770 crores at industry level.

    • F&O ADTO on a premium basis fell 13.6% QoQ to INR 55,570 crores at industry level.

    • Overall industry volumes for cash fell by 16% and F&O by 14%.

    Key financials

    Single quarter

    05 metrics
    1. 01Total Income₹77.3 Cr0%QoQ
    2. 02PAT₹9.48 Cr-18%QoQ
    3. 03Average Client Funding Book₹364 Cr+17%QoQ
    4. 04Mutual Fund AUM₹1,647 Cr+4.7%QoQ
    5. 05Net Worth₹626 Cr

    Guidance & targets

    1
    CategoryTargetPriority
    Profitability
    H2 FY26 Performance
    Better than H1 FY26
    		Low

    What to watch in Q2 FY26

    4

    H2 FY26 performance (revenue/profitability)

    H2 FY26
    CurrentQ2 FY26 PAT down 18% QoQ, Total Income flat.
    TargetBetter than H1 FY26

    Why it matters

    Management hopes for a better H2, which would indicate a recovery from current market headwinds🌐.

    Well, we expect it to be better, but, like, the markets have to contribute equally. Right? So, that is something I can't predict. I'm hoping that H2 will be better.

    Risks & concerns

    3
    RiskSeverity

    Volatile equity markets, FII outflows, geopolitical tensions

    Equity markets remained volatile amid tariff-related uncertainties, persistent FII outflows and rising geopolitical tensions that weighed on investor sentiment. — Management acknowledged

    high

    Industry-wide decline in market participation

    Cash market ADTO declined 16.7% QoQ to INR 39,770 crores and F&O ADTO on a premium basis fell 13.6% QoQ to INR 55,570 crores at the industry level. — Management acknowledged

    high

    Dormancy of new clients

    Many new clients become inactive, especially those who entered during market frenzy or made losses, impacting active client base. — Management acknowledged

    medium

    Q&A highlights

    8

    “So, the overall, if you look, the income or the revenues, 1% down compared to the last quarter, so it's not a significant degrowth. Overall, volumes for the industry have also fallen in the last quarter, as I think mentioned in my speech, by 16% for cash and about 14% for F&O. So, our reduction in revenue is in line with those numbers.”

    Clarifies the impact of industry-wide volume declines on the company's revenue, indicating external factors were primary drivers.

    asked by Heet Modi

    2 min read7 chapters

    Detailed Narrative

    01

    Market Overview and Industry Trends

    During Q2 FY26, equity markets experienced volatility due to tariff-related uncertainties, persistent FII outflows, and rising geopolitical tensions, impacting investor sentiment. This led to a 16.7% QoQ decline in cash market ADTO to INR 39,770 crores and a 13.6% QoQ fall in F&O ADTO on a premium basis to INR 55,570 crores at the industry level. Overall industry volumes for cash and F&O declined by 16% and 14% respectively, contributing to a 1% revenue dip for 5Paisa Capital.

    02

    Customer Acquisition and Engagement

    Despite challenging market conditions, 5Paisa Capital focused on customer acquisition, achieving a 20% QoQ increase in new customers to over 95,000. Customer acquisition costs were reduced by 15%, and the first-year revenue (FYR) improved by 25%, leading to a more efficient payback profile. The company's total customer base successfully crossed the 5 million (50 lakh) milestone.

    03

    Trading Activity and Product Enhancements

    The company saw robust trading activity, with average daily turnover rising 18% QoQ to INR 2.6 trillion. MTF income grew by 22% QoQ, and the average client funding book expanded 17% QoQ to INR 364 crores, driven by competitive interest rates and an expanded universe of eligible securities. Mutual fund AUM also increased to INR 1,647 crores, representing a 4.7% sequential growth.

    04

    Financial Performance

    Total income for Q2 FY26 remained steady at INR 77.3 crores, broadly in line with the previous quarter, despite market headwinds🌐. However, Profit After Tax (PAT) for the quarter stood at INR 9.48 crores, marking an 18% QoQ decline. The marginal rise in expenses was attributed to higher marketing and branding investments, along with increased finance costs linked to MTF income growth. The company's net worth as of September 30, 2025, was INR 626 crores.

    05

    Product and Technology Upgrades

    5Paisa Capital implemented several upgrades to enhance trading efficiency and user experience. These included a revamped digital onboarding journey with real-time bank verification and PIN-less Digi Locker integration. New features like an in-app ETF dashboard, a 'Pay Later' option for MTF, and the 'Scalper' platform for traders were introduced. The company is also re-platforming its core system, expected to conclude next quarter, and is building new algorithms.

    06

    Market Strategy and Differentiation

    In a hypercompetitive and cluttered market, 5Paisa Capital aims to differentiate through product features tailored for serious traders and increased brand awareness. The company is making significant investments in brand marketing to improve visibility and ensure that once users try the platform, they choose to stick with it. Management emphasizes focusing on its own product roadmap and customer feedback rather than solely chasing competitors.

    07

    Industry Pricing Trends

    Management noted a potential industry trend towards charging for services that are currently free, driven by the eventual end of cross-subsidization. While 5Paisa already charges INR 20 for equity delivery, the broader market might see new charges for various services, which could reshape the competitive landscape. This shift is anticipated as volumes are impacted, necessitating new revenue streams.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.