The first question comes from the line of Swarnabha Mukherjee with B&K Securities.

Three questions from my side. First one, I wanted to have a better understanding on the expense head for the quarter and how we should look about it for FY '26 in particular, in terms of the reversal of the variable pay, what was the rationale for the same, and then when we move ahead in FY '26, as you mentioned in your opening statements in terms of incremental provision for the variable pay for the next year, how should those numbers look for FY '26? And also, if you could give similar comments related to the opex because as I am seeing that the customer acquisition rate has come down, but even if I remove the IPL related costs from the opex head that you have reported, I think the headline number looks fairly steady. So with lower customer acquisition, the opex levels still continue to remain steady. So has the cost of acquiring new customers gone up? And if so, I mean, would it be like a structural thing? Or should we expect it to mellow down going forward? So based on the cost side and also wanted to understand in terms of the cohort level analysis that you have provided, if I look at the revenue generation across various cohorts, what I see is that in the current environment, so FY '25 versus FY '24, I think the revenue drop for the customers acquired in fiscal '23 has seen a more disproportionate impact. So what is -- I mean, if you could highlight what would be the reason why this particular cohort is more impacted vis-a-vis others? And secondly, also, I noticed that the breakeven period has impacted. So is this more a reflection of market situation? Or is there something structural and it should prompt us to look at our strategy? So these are the broad level questions. I have one or 2 bookkeeping questions, which I can possibly ask after the response.

So Swarnabha, on this variable cost as our industry is cyclical, always we say we have some buffers, which are variable, which we can play with. So when we set our targets, we set certain variable portion. If we missed that this time because of regulatory changes and all that, we were unable to reach our targets, so definitely, there is a reversal of variable cost. But going forward, always this is the practice, we do some projection based on that, we work out fixed and variable pay. So for coming year also, same system would be followed. So on second question on customer acquisition, I will ask Arief to address this later. On your cohort level revenue and all that, we don't disclose much on that unless -- Amit, do we disclose cohort level revenue?

Okay. One second. You can take that later. And on breakeven impact, we believe that if we look at customers' wallet share, that has not shrunk. So their engagement in this market will, in fact, going to improve. So except for the temporary phase that we are seeing because of regulatory change and macro getting weak and all that, we are seeing this impact. But otherwise, I believe that we will be able to maintain this breakeven of between 6 to 9 months. So Arief, you can take that customer acquisition cost and then Amit, you can take that cohort level.

Thank you sir.

If I can just -- sir one just follow-up on the employee expense side. If I just understand, I mean, we are broadly running at INR200 crores, INR210 crores kind of a run rate in second and third quarter. For the provisioning and basically the number for, say, 1Q onwards, should we expect a number higher than that?

Okay. Let Vineet answer this properly. Vineet, if you can take this question.

Yes. So Swarnabha, obviously, with the increments and the new variable pay provisions for the current financial year, the numbers will be higher than the previous year, but you can take the trend of the previous years and extrapolate these numbers.

Okay sir , helpful.

Yes, Arief if you can take that.

Yes. Thank you. Good morning, everyone. Thanks a lot for the question. That's a very -- so when I look at it, the cost of acquisition had gone up in JFM across the industry, driven by a couple of channels and correspondingly, it also went up for us. But our acquisition mix is based on a multiple set of channels, and we have corrected for that mix. And we are very confident that the COAs will come down as we go forward, and we are already seeing the reduction as we get into April.

Sir, just one quick follow-up. This reduction, will it be like what we have seen previously in non-IPL periods or so? So maybe somewhere at the level of 2Q or something. Would that be a fair assumption?

There will be a seasonal mix of IPL being slightly on higher side, but we see it below last year levels as we go forward.

Understood.

Okay. Amit, you can take the next one.

Yes. Thank you, Dinesh bhai and Swarnabha, on the cohort level revenue, the question that you posed. So FY '25 has been an extraordinary year for reasons that we all know. And if you observe carefully, you will see that almost for all cohorts, there has been an impact. With respect to FY '23, in particular, that you mentioned, well, this is just the start of a cohort of customers, which has to be allowed some time to stay on the platform for them to start generating revenue. So I think what we tried doing here is transparently declare Y-o-Y cohorts that we have been acquiring and how their behavior has been over a larger period of time. So actually, if you see from year 3 or year 4 onwards is when there is consistency of revenue of that particular cohort. So therefore, in case of FY '23 and for any other year beyond, we have to allow for a few more years to go by for us to make a very firm assessment around the quality of that cohort. We are not seeing a significant challenge so far as cohort acquisition is concerned because our acquisition metric for cohort-wise -- acquisition metric for cohort has been consistent Y-o-Y. So we have not had a significant change in the way we acquire our customers. On your point on breakeven, again, to look at a breakeven point for FY '25 will be very short-term view. You will have to again allow it some time to settle. We continue to believe that when markets are normal and in a cycle of 4 to 5 years, you will have periods of abnormal market conditions, either downward or upward. And therefore, the way to look at this is more long term and allow the entire cycle of 5 years to play out. And therefore, that year of FY '25 breakeven is not a number that you should go by in terms of future trends.

Okay, sir. That's very helpful. Just a couple of bookkeeping questions. If you could share the mix between cash intraday and delivery orders among the overall cash orders mix. You used to disclose that earlier, but I think I did not find that in the presentation. And second is in terms of the new ventures, for example, Ionic wealth, is the number -- where is the number reported in our overall revenue mix that we have provided in the gross revenue?

Vineet, if you can take that Ionic Wealth and then Amit, you can check whether we disclose the mix or not.

Yes.

So the new businesses, including asset management, wealth and distribution, they are clubbed under distribution. The 3% revenue that we have disclosed as a constituent of the total revenue, it's included there.

Okay, sure sir. On the order mix if you can...

Swarnabha, on the order mix, since now we are charging for both cash delivery and cash intraday, it doesn't make any difference. So we've clubbed it as cash segment. And you can continue to extrapolate those numbers.

Next question comes from the line of Prayesh Jain with Motilal Oswal Financial Services Limited.

Just a few questions. Firstly, on the expenses front, again, you mentioned that the cost of acquisition has gone up. First of all, could you allude the reasons for the same? And how do we see this? You mentioned that it will go down. But if this run rate, even it sustains or if it kind of goes down by 10%, thereabouts, still the margins that you had spoken about in the earlier call that a long-term sustainable margin of 45% to 50% seems to be far-fetched right now. So what kind of trajectory should we think about EBITDA margins from FY '26? Or as you mentioned that Q4 FY '26 will be first normal quarter of normal levels, that would be -- would that mean a 45%, 50% EBITDA margin by then or would you say FY '27 will be a year where we should think about that kind of levels? That would be my first question. Second question would be on the wealth business. You mentioned in the presentation of about ₹ 3,300-odd crores of AUM. Could you split it for us as to how much is transactional? How much is in MF, PMS, AIF? What is the color of this book today? And because the size looks pretty good. And what is the kind of revenue potential out of this asset on a yearly basis? Third question would be on the MF AP channel. You mentioned that AUM has been gaining traction. What is the kind of AUM size that you would have achieved in this business? And last on loan distribution, you have been able to distribute only about ₹ 100 crores in this quarter versus about ₹ 240 crores in the previous quarter. Why this decline? And what kind of traction should we see from here? Yes, those would be my questions.

Okay. Great. First, on this thing, expense side, cost of acquisition, Arief will take in terms of what do we see in terms of cost of acquisition going forward. But let me tell you one thing. See, our model, coming back to margin and all that, cost of acquisition, if at all, in certain quarter goes up and down, but still it is not as big to change the margin profile of the company altogether. Because even in digital company, if you see cost of acquisition to LTV, if it is even 5 - 5.5 also, you will see margin going beyond 50%. So I believe that, okay, already what we are seeing is that, okay, there will be some seasonality. There will be some change in terms of pricing in certain channels, but we acquire customers from multiple channels. So we would like to then focus more on channel, which is more viable for us to acquire customers, so we are seeing enough channels are available for us to maintain kind of a growth rate in customer acquisition. In terms of margin, because of this regulatory changes, macro and lots of things happened in this quarter 3 and quarter 4, what we are seeing is that in terms of revenue curve, we are seeing bottoming up from, say, like revenue curve has changed from Feb and in March, we saw an uptick. And as we speak also, we are seeing that revenue curve has taken a turn for better. Margin expansion, you will see at the exit of quarter 4 where again, you will see a margin coming back to 40%, 45%. So exit of quarter 4, we will see again margin coming back and we again going back to normal kind of like productivity metrics, margin as well as ROE. And yes, on Wealth Management, if Srikanth or Shobhit, you can take this question.

Yes, I'll take it, Srikanth here now. Prayesh, thank you for your question. Happy to sort of answer in a manner that while it's been a year as far as wealth inception is concerned, we actually became fully licensed over the last 4 or 5 months. So in view of all of that, we -- on our roughly about ₹ 3,370-odd crores of actively managed assets, around 75% of that is in the nature of recurring AUM, which means it's a mix of advisory, it's a mix of trail-based distribution businesses and about 20% to 25% of that will be transactional assets. The only reason I will add a caveat for no other reason, but the fact that it's too early for me to project the trend line. I think the team is experienced enough to know that a good high-quality wealth management business is built when you build a strong annuity income over long periods of time without losing focus on strong tailwinds as far as transactional opportunities are concerned. So at this moment, it is close to about 3/4 of this in various portfolio compositions across advisory and trail income and about 20%, 25% would be into transactional assets.

Srikanth, what is the revenue contribution of this ₹ 3,300 crores in a sense, what basis points could you be doing it on an annual basis in terms of revenue?

Yes. Prayesh, at this stage, as I said, I think it's just been about 3, 4 months. So we haven't done a full 1 year of seasoning, but we are fairly in line with what the established best practices in the markets are. So now that we have clearly established benchmarks in terms of what others are in terms of an annual margins. At this point of time, we are fairly in line with that, but I would want this to be seasoned a bit more before we start getting into specifics. But at this point of time, a very healthy mix of this AUM is into an annually recurring kind of color.

Yes. And on your AUM on mutual fund, already, we are building a good AUM on direct as well as B2B, but your question was particularly on AP. I will ask Nishant to answer this. Nishant, you are there? Okay. Let Nishant come in. On loan distribution, Saurabh, you can take this question.

So yes, on the credit disbursement side, we saw a temporary moderation this quarter due to cautious underwriting in slightly volatile macro conditions. That said, momentum is actually slowly picking up again as confidence is beginning to return and funnels are becoming slightly better. Having said that, we are focused on building a strong, sustainable lending play with the right partners, the foundation is being laid right now and which positions us well for long-term scale and resilience. Short-term softness is not something that we are really worried about. Also, as I mentioned earlier, last quarter, we have added 2 bank lenders and a fintech, right, and built very solid AI/ML models on propensity and matching algorithms, right, all moving us towards a very robust future for credit in Angel One. I hope that answers your question.

Yes, I got that.

Okay. Did we get Nishant back? Nishant, can you hear me?

Yes. I can.

Can you just give brief on MF fund AUM that we have built in that AP channel?

Sure. So with regards to your question, we have grown by about 2.2x with regards to the last financial year in this year. This has been coupled with some of the interventions that we had done in this space, driving mutual fund distributor appointment. We in fact, acquired over 7,000 mutual fund distributors in this year itself. There were a lot of intelligent cross-sell nudges that we were providing to our users to, therefore, build traction around SIPs, lump sum. And some of those initiatives have helped us deliver about ₹ 3,700 crores of AUM as we exited this year.

Next question comes from the line of Pradyumna Choudhary with JM Financial Family Office.

So 2 questions. First one is, if I look at your F&O market share, there's been a slight moderation in Q4 compared to Q3. So how should we maybe look at this going forward given that anyway, the market share gains have already slowed down compared to earlier quarters? And similarly, on the commodity side, the last 3 quarters, we've been seeing a declining market share. So how should we really understand this? And if you could maybe comment on the players who seem to be taking the incremental market share? That's the first question.

Okay. Devender, you'd be -- please take this question of F&O market share. And commodity, who would be the right person to answer that?

I'll take both of them. Mr. Choudhary, from an F&O market share point of view, we see a slight change. From an overall trajectory point of view, we are seeing incremental market share gain. We are seeing a temporary dip with that F&O regulation changes coming in, which is affecting the retail client segment, particularly harder, where we have a very strong market share. And that is reflective of that aspect only, which is basically you can see that there is some reset that has happened and it is the growth that we have been able to do will continue from there. From a commodities point of view, I think it's more of a composition mix of the commodities market, where traditionally, we have a very strong market share in crude oil. And what lately has happened as the composition of the market is changing and crude oil turnover contribution in commodities has gone down, this is what is reflective. We have not really lost any market share. It's more of a composition mix, which is reflecting in terms of the overall market share that Angel is having.

Understood. Well understood. And second question is on the activation rate. So one would ideally expect this number to -- at certain times, if I compare over the last several years, quarter- by-quarter, one would expect this number to at times go up, especially during a bull run when you expect maybe the active clients would start growing faster than the total clients and maybe decrease during a bear run or a flat markets. But what we see is it has continuously declined over the 2-, 3-year period quarter-on-quarter. So if -- like why is this happening? And if this is happening, so then is it even a right metric to look at total client acquisition given that maybe we are anyway not able to convert a larger chunk incrementally into active ones?

What happens we need to have a particular base. From that base, a certain amount of customer becomes active. It is not that the person becomes active, they only remain active. As you rightly said, in bull market, bear market, you will see different kind of customers becoming active of the base. So if base is larger, definitely number of customers getting active in good times and all that would be more. But if there's a bear market, lots of people who have opened the account, maybe bought some shares, they would like to wait till the time they find a proper opportunity. It is not those accounts are dormant or they are not interested in market. They are opening the app. They are getting engaged in terms of looking at markets and all that. So customer acquisition is important to increase our base. So that's the top of funnel that we get. And when market conditions based on whatever liking customer has, they become active.

Next question comes from the line of Karan with Jetha Global.

Can you hear me?

Yes, I can hear you.

Okay. Great. And hopefully, we're turning the corner. So I wanted to just address the multi sort of vertical strategy here because you're setting yourself up for what is hopefully a very durable growth. I'm pretty curious to hear from the new CEO on how -- what is his assessment of the tech stack. We had to rate it on -- you had to grade Angel One's tech stack today, maybe on a scale of 1 to 10, where is Angel One. And then what's the plan there in terms of getting the tech stack to a place where you can obviously sell these products and it's seamless for the customer and all of that? Are we already there? Or is there a lot more work required? And then I guess a broader question is, if you look at the materials, these calculations on cohort and LTV and paybacks, they're all -- they only consider 1 product or maybe 1.5 products in terms of what the customer is doing. But can you give us a sense of a customer who has actually engaged with many of these other products? Maybe they are using 3 or 4 of your products, they bought an ETF, they bought an insurance policy, they've taken a loan, they're buying and selling derivatives. What does that look like? And ultimately, if you're paying higher CAC, are you underwriting that these customers are going to eventually subscribe to more than one product? So how are you bringing it all together in terms of products per customer, however you want to look at it?

Okay. I will take 2 questions. Latter one first. And on tech stack and all that, I will ask Ambarish to comment. In terms of like cohort LTV and all that, currently, our calculation is based on revenue that we get from broking services and allied services. So we are new in terms of getting into other products like mutual fund, loan business and all that. So we are still in the process of building up and gaining some good market share. So going forward, definitely, all that revenue from this customer from all these services will be incorporated. And on higher CAC, it is just, I think, a temporary phase. Right now, we are not targeting higher CAC based on revenue from other verticals because we feel that we have enough base and we are able to attract enough clients who can justify their CAC based on broking revenue. But as we get more detail and data on revenue from other products, definitely we would like to acquire customers at higher cost. So that's broadly our strategy that going forward, we want to be a platform company where we are able to sell multiple products and then see what the revenue we can get from this customer and what is the lifetime value based on that, we can increase our cost to acquire the same customer. Ambarish, if you can take that tech stack question.

Yes. Thanks, DT, and thank you, Karan, for the question. I'm actually very pleased with the shape of the tech stack at Angel One across the board and across products that you see. In fact, if you look at Angel One, it's the only company that kept up with the times really across the board and continuing to evolve. So the tech stack is in phenomenal shape. That said, I think it's a continuous process. You have to continuously evolve with the times. And the good news is we have a phenomenal team. DT talked about Rohit joining the team, but we have a phenomenal set of leaders across the board who are continuing to stay up with the times. You are also going to see more investment, as we have talked about in artificial intelligence and that being an inflection point. So that will continue. But to your question, the tech stack is in a phenomenal shape, is able to handle a large amount of volume, a large amount of features and keep up with all the compliances as well.

Next question comes from the line of Abhijeet Sakhare with Kotak Securities.

My first question was -- so I wanted to get a sense of the customers that we've acquired in the recent quarter because this is coming with a new set of -- under a new set of regulations. I wanted to understand if this set is -- this cohort is behaving very differently in terms of activation rates or the first products that they trade with. And a related question would be, how has been the competitive intensity in terms of customer acquisition during this quarter? And second question is just to go back to the previous question to AK, which is that if you could talk about a few areas where he thinks he can make a decent sort of intervention or impact on the current business because he comes with a financial services background plus a consumer background. So Angel in a way kind of is a mix of both. So are there any areas where we can see some major shifts based on his experience?

Okay. Sure. DK, if you can take this quality of customers that have been acquired after regulatory changes. And let me just answer in terms of competitive intensity, I think that, okay, that is not an issue because we are gaining market share. And it seems that, okay, whatever we are doing in terms of efficiency, it is better than competition. Currently, any kind of like element which is coming from competition is not really a concern. In fact, we are looking at how do we delight our customer in a far better way than what competition is doing. So DK, you can take this customer quality. And Arief, if you want to add on this competitive intensity first?

Yes. Thanks, Dinesh bhai. Abhijeet, from an overall point of view, the customer profile remains overall pretty same as what we've been acquiring in quarter 2 and quarter 3. But what impact we have seen on the overall industry is also similarly applicable to the new clients that is there as well. But I believe that as the consumer behavior evolves, some of the product segments have gone away, our belief still stands. The wallet share that we have been able to take care will continue to elongate, and we'll see these impacts coming in the next 2 quarters where their behaviors will evolve. That's what the belief is. From a competitive intensity, I think, Arief, do you want to put some words?

Yes, yes. Thanks a lot for the question. On the competition intensity, I would say that our read is that there's a lot of wait and watch that is happening in general across the industry, but we feel that this is also a good time for us to be staying aggressive in acquiring clients, right? Also to kind of add on to what DK mentioned, see, bearish and bullish markets might have an impact on the immediate activations. But once you acquire a client, they are an asset that will keep adding to the growth. The activation might slightly take a slightly longer gestation, but they will return back the goodness for us is how we look at it.

Ambarish, if you can take that -- your final question.

Yes. Thank you for that question. I think any leader coming in, as you would understand, has to, of course, enable the team, and that's the most critical thing. And I see a fantastic team already in place and moving in the right direction. So what you're going to see is that I'm going to enable and be a multiplier for that. But that said a few areas that I have in mind and you will see happen is, number one, I think as we do more product diversification, we have lending, insurance, other things that you see around us, how do we bring all of these things together and make it better for the customer and create a fantastic place for financial services platform for people to come in there. So that's a very important part of it. How do you sort of bring it all together? Number two, I think you will see a bunch of chat from me on AI also artificial intelligence and machine learning over as we continue this conversation. And you're going to see a few areas where it's going to impact, right? Number one, it's going to have an impact on what you see built into our products, models, personalization. So you're going to see AI impact on that. Number two, you're going to see an impact on how we produce those products. Are we doing code generation using AI? Are we building our UX through AI and stuff like that. You're also going to see that impact, and it's already starting to happen in our processes and what -- how we are using AI tools internally to improve our processes, making them both efficient and effective. And in the long term, you're also going to see us getting smarter using AI, just use it for learning and other things. Now this is not all going to happen next quarter, right? It is a journey that we'll continue on, and we'll continue that conversation. The last thing I'd mention is that we would also get better at -- it's evolution, but get better at reading signals from the customers, understanding them better and creating better, more delightful journeys for them as we acquire them as well as take them through our product. Thank you.

Mr. Sakhare, are you done with the questions?

Yes. That was useful.

Next question comes from the line of Ajox Frederick with Sundaram Mutual Funds.

Sir, you have mentioned that the impact of new businesses on your cost is 1.8% for the full year. Can you help me understand what was the quantum in 4Q?

Vineet, if you can take this question.

Sorry, can you just repeat the question? What was the quantum? I couldn't get the last bit.

Yes. The quantum, which was on account of incubating new businesses, the expenses basically in 4Q.

Yes. So the net burn in 4Q was about ₹ 62 crores, ₹ 63 crores for these 2 new businesses, which is the Asset Management and Wealth Management, which translates to about 1.8% of the operating margin overall.

I'm assuming that's for the full year, right?

No, this is for the -- yes, full year. And for the quarter, I think it was about -- yes, I mean, it's 1.8%.

Okay, sir. Secondly, sir, you also mentioned that you have confidence of bringing down COA eventually. So what feelers or what indicators are we seeing out there to bring down the cost of acquisition?

Arief, you can take this question.

Yes, DT. So it is not -- just to correct that -- so it is not about getting the COA down eventually, whatever increase that we saw in JFM, we have corrected for our mix. And we are already seeing that cost of acquisition coming down even for this month. So it's not about an eventual scenario. So we are already there.

Yes. In this cost of acquisition, what is important is that, as I always said that, okay, what is the lifetime value of a customer and which pockets can we get into to get more market share. So always our focus would not be on reducing any kind of like cost when it comes to acquiring customer. It is more about getting quality customer for whatever kind of like geography we're acquiring. So in JFM, what happened was a temporary kind of like bit upside. But what we are talking about, we'll get back to the normal trajectory. But as we see more revenue coming from the same customer because we are getting to multiple products. If we see we are able to sell more product than just broking, definitely, it makes sense for us to even increase our cost of acquisition. So we are constantly monitoring what the cost of acquisition and what kind of activity we see of a customer on our platform.

Next question comes from the line of Nidhesh Jain with Investec.

The first question is on a possibility of price hike that is completely off the table or that is still under consideration, given that we have already seen 3, 4 months of customer behavior after the regulations?

Nidhesh, we have to watch in terms of -- because there are lots of things which happened in this quarter as last time I told. We have to wait for 1 or 2 quarters to say that what is the behavior of customer post these regulatory changes. But initial sense, what I'm getting is that, okay, we would be back to normal kind of margins by exit of quarter 4. But till the time it is not necessary for us to look into prices, we would like to maintain this price. So initial kind of signs what I'm saying in terms of, as I said, that revenue curve has almost bottomed out, and we are seeing revenue kind of like improving since March. So we would like to monitor this situation for 2 quarters before we take a stand on price. See price, I feel customers are not sensitive, but we want to maintain this price if we are confident that we would be able to get to this margin what we would be comfortable, that is in the range of 45%, 50% in few quarters. So stand would be wait for a few quarters, take the behavior of customer. As I said, there are lots of products that we are introducing, look at kind of margins, what we'll get from customers that we have and we acquire. We are confident that in a few quarters, we would be able to bounce back to margin of 40%, 45%. We would be comfortable focusing on increasing more customers on this platform. See, digital company has to look at how many more customers we can serve on a similar platform. So till the time we are seeing customer acquisition rate is very high, we would like to pause and check and take a call only if it is necessary.

Sure, sir. Understood. And second question is that -- so we started as a digital broking business, then we are now doing a lot of things on the financial management side for the client. So do we also think that there is a possibility of entering into other financial service areas, specifically on the transaction payments, credit card side to become a holistic financial services platform over a medium-term perspective?

See, currently, our focus is to be a distributor for all the services. So whatever services user wants and where we can extend our platform, we will do that. AK, you want to say something on this?

No, I think that makes absolute sense. I think we've got a platform that we've got tons of customers coming here. And we are already doing -- of course, you talked about AMC and Wealth Management, but we are starting -- we are doing lending, insurance, of course, broking very big. So those are all just the right things, and we'll continue to distribute any financial products that we can on a platform. So think of it as a platform.

Next question comes from the line of Vikram Raghavan with Moon Capital.

Just one question. What is the percentage of revenue expected from new businesses over the next, say, 1, 3 and 5 years?

Yes. So we believe these new businesses, especially like distribution of credit, insurance and particularly wealth management, they can really substantially grow at a good size given if it all we give proper time and focus on that. And that is our focus that how to become a leader in all this kind of like vertical. But to give a time frame in terms of what the percentage of revenue mix will happen in next few years would be difficult to predict because even broking is expected to grow at a very high rate for the next 15 to 20 years. So even if we are able to grow other line of businesses, so to give a kind of a call in terms of what the percentage revenue that we'll get from other businesses in next 3, 5 years, it's a very dynamic call that because we have to keep something constant. But when all these verticals are growing at a good rate, I can tell you one thing that our aim is where -- whichever vertical we want to get into, we want to achieve leadership position. In any other vertical that we have gone apart from broking, broking, definitely, our aim is and we are leaders, but we would like to be a leader in that in the next 3 to 5 years.

Next question comes from the line of Aman Dugar with Nuvama Wealth.

This is Madhukar Ladha here from Nuvama. I don't know whether this question was addressed or not. The total staff cost for the year is about ₹ 855 crores. And in Q4, there has been a little bit of a reversal in variable cost. Can you spell out what is the total fixed and variable cost -- staff cost for the entire year? That is just one thing that I would like to know.

Vineet, you can take this question.

Yes. Thank you, Madhukar, for this question. But we don't really disclose the entire variable. As we said, we've reversed a large part of our variable cost in this year. So you can extrapolate the number based on that. And of course, there is a little bit of variable pay that we give to some of our other junior level employees.

Next question comes from the line of Sanketh Godha with Avendus Spark.

Basically, the question is that your March saw an improvement in number of orders per day to 5.4 million. And I just want to understand in April, how you are seeing the trend. And actually, in the full year, you were at 6.9 million orders per day in FY '25. So just wanted to understand, are you decently confident that for FY '26 the number of orders for the full year or by exit at least, you will claw back to 6.9 million orders per day is the first question what I had. And the second question was, sir, that in the fourth quarter, your margins were at around 32%. I believe in first quarter of FY '26, it will be more impacted maybe because of higher IPL cost allocated to that quarter. So from residual 9 months of the next year, to even deliver 41% EBITDA margin, you should be maybe closer to 45% plus or maybe closer to 50%. So just wanted to understand what are the levers you might be having other than maybe cost- cutting exercise to deliver EBITDA margin at least similar to what you have delivered in FY '25. So that -- those are 2 my questions, means if you can give a little number related things, it will be really useful.

Yes. See, we always take a number based on like averages what industry has delivered. So to take a call on 1 month or 1 quarter would be difficult. But what we believe is that factors which were impacting kind of like create dullness in market are getting resolved. Macros of India, if you see interest rates are coming down, So that will bring in more customers to equity market. So our belief is based on averages that we see for 3 years, 5 years and all that. And based on, we understand that customers what we have acquired will become as active as they were maybe in quarter 2 of last year. So to give a call that, okay, whether it is going to improve in a few months or 1 or 2 quarters will be difficult. But as you rightly said that, okay, we can take a call that by exit of this financial year, we would be able to acquire a certain amount of customers, and we believe activation ratio of this customer would be at a certain point. Based on that, we are confident that by exit of quarter 4, again, you will see margins coming back to this. So to comment on quarter 1 onetime cost, the IPL cost is a cost which has to be kind of like -- which is giving us more visibility, more recall. So when we talk about Indian youth coming to this market for the next 5 years, 10 years, 20 years, you should think about Angel One as a preferred kind of like platform company. So this cost, I think we should look at a bit medium- to long-term horizon, although we had to book it in that quarter itself, but I would say it is something like earning before this IPL, which should matter to all the analysts because benefit that we get from IPL is a bit medium to long term. So we are confident that we'll be able to achieve a good margin kind of like by exit of quarter 4. We are not looking at cost cutting. We are focused on growth. We believe by exit of quarter 4, you will see lots of other verticals where we have started investing will contribute to the revenue, may not be to profits. But what happens, what is important is that, okay, slowly their burn rate and their focus on being a leader in all that is going to ultimately generate more revenue from per customer that we acquire. So we are very confident by exit of quarter 4, we will see everything would be almost to normal what we used to see in this industry because as a digital company, there's a fixed cost that we have to take to build the platform. So incremental customer that we acquire, margin from that incremental customer is very high. So we are very confident if you look at growth rate of acquisition that we are getting, even in bad market where -- we never knew how do we acquire a customer, how do we react when there's a big regulatory changes. Now that everything has stabilized, worst is behind us, we'll again work out a proper growth strategy where we are able to acquire more customers, which will lead to expansion in margin by exit of quarter 4, yes.

Got it. So basically, you are decently confident that by end of the fourth quarter, you will get to 45%, 50% kind of a margin, which we usually used to operate in that sense?

We can say 40%, 45% by exit of quarter 4, and it will expand as we move to the next financial year.

Next question comes from the line of Swechha Jain with Whitestone Financial Advisors.

I have 2 questions. My first question is, sir, when we distribute the third-party products, I just want to know how much do we get as a part of commission or whatever, how much do we make on this? And second thing, sir, I wanted to know if you could share how much revenue have we made in this quarter from distributing the products other than the broking revenue. So products from AMC -- revenue from the AMC, wealth management, credit distribution and insurance. If you could just give me...

Vineet, can you take this question based on whatever we disclose.

Yes. The percentage of revenue that we have earned from the distribution part of the business, which includes the distribution of credit products, insurance, the asset management and the wealth management businesses is about 3% of the revenue.

Overall revenue. So this is Q4, right?

Yes.

Okay. Fair enough. And sir, when we distribute the third-party products, how much typically we make on that?

In general, if we make take this.

Sure, sure. So in general, for most products, I think we make in line with the industry, be it credit or insurance, right? And for mutual funds since we largely do direct at one part of the business, there, it is zero commission. For the regular part, we make in line with the industry again.

Next question comes from the line of Bhuvnesh Garg with Magma Ventures.

Just a couple of data keeping questions. So firstly, if you can mention the ESOP cost for Q4 and how it would look like in FY '26 and '27?

Yes, Vineet, if you can take this question.

Yes. The cost for stock options has been in the range of about ₹ 35 crores - ₹ 38 crores quarter- on-quarter. And overall, for the entire year, it's in the range of about ₹ 105 crores. Next year, based on the grants that we are going to do now, the cost is going to increase. I'll come back with the number maybe in first quarter once we have the grants in place.

Okay. Sure, sure. Second question is on gross broking revenue per order. So if I see, it was flat quarter-on-quarter, but I understand that we start charging on delivery orders from mid- November onwards. So basically, Q4 would be the full quarter where there should be the full impact of the charges on delivery order. But still, the revenue was flat -- per order was flat Q-o- Q. So if you can just explain what was the reason for this?

DK, you can take this question.

Yes. Mr. Garg. So at an overall level, the macro of the industry has been subdued in quarter 4, which has impacted. But what I'm seeing, it's more of a play of the composition mix of various segments that has kept it flat and the macro conditions, which we believe in the coming time will recover. So it's just a macro aspect.

Next question comes from the line of Ajay Nandanwar with Blue Argon Capital Capital.

Quick question on your sort of future growth areas. What's the opportunity you see in distribution from a customer perspective and from your right to win perspective?

Saurabh, you would like to take this question?

I'd actually want to hear that question once again, please.

Sure, of course. So you mentioned that you want to focus on distribution as a growth area going forward. I'm keen to understand what do you see as the opportunity in the market from customers' perspective and from your sort of competitive advantage perspective?

Yes, sure. Great question. So I mean, if you take one area at a time, if you just take credit, which is like the key focus area, unsecured credit over the last 3, 4 years has grown massively. You would have seen close to ₹ 6 lakh crores to ₹ 8 lakh crores of PL being distributed in the market over a 1-year time frame itself, right? So the size of the opportunity and that too growing at close to 20% CAGR over the last 3, 4 years. So over the next 4 years, 4 to 5 years, we might look at close to a ₹ 20 lakh crores annual offtake in PL in India, right? Even if we look at, say, a 1% market share, that is ₹ 20,000 crores of PL being distributed. So that is the size of the opportunity that we look at only from an unsecured credit in PL perspective. Then there will be more growth areas that we will enter over time in credit, be it on the unsecured side or the secured side as and when we deem fit. Even on the insurance side, if you see digital penetration as of now is still very poor. And with large regulatory push from IRDA, right, to have more penetration, this size of the business will also keep on growing. So I think both these areas, be it insurance or credit, we are very bullish that they can become very sizable business over the next 3 to 5 years.

Yes. Apart from that, even like mutual fund AUM, wealth distribution and all that, all that verticals are very promising.

I don't doubt the size of opportunity. My question is more about what is Angel's competitive advantage in that space. We have been a broking house for a long time. So what our sort of differentiator when it comes to distributing.

Saurabh, you would like to answer? Let me just cover this, then I will give it to you. The main advantage is that we have built an excellent platform where customers are really loving to buy more products. So our cost of acquisition becomes limited. If you are able to sell incremental products, definitely, that makes a big sense for us. And even for a customer, it makes a sense that they are buying all the product from the same platform. So that is where we have invested on tech, and we have created a big kind of a team who have created a very delightful kind of an experience on this platform. That makes very kind of like user-friendly platform for user who is coming for one product and buying multiple products. Yes, Saurabh, over to you.

I'll just to add to what DT said, I think there are 2 or 3 large levers. One, the customer quality that we see on our platform is substantially good. right? The second is the engagement of the customers on the platform is higher than a lot of other consumer platforms in the country. And the third is the amount of time that they spend on our platform gives us a lot of handle on their data, right? So these are 3 large levers that enable us and have clear competitive moat with respect to others who are doing plain vanilla distribution for their customers.

Got it. Okay. One more question, if I could. On the client funding book, what's the yield on assets? You have around ₹ 3,850 crores asset book. What's the yield on it at this point?

Vineet, if you can take this?

Yes. So we levy an interest of 14.99% on MTF.

If I look at the interest income, it seems much higher. It's ₹ 338 crores. Is there something else there?

Yes. So this interest revenue line item comprises of 2 components. One is the margin trading -- interest from margin trading funding and the other is interest from deposits that we place with the exchanges.

Ladies and gentlemen, due to time constraint, that will be the last question. I would now like to hand the conference over to Mr. Dinesh Thakkar for closing comments.

Thank you for joining us on the call today. I hope we have answered your queries satisfactorily. Should you require any assistance, please feel free to contact Hitul Gutka, Head of Investor Relations or SGA, our Investor Relations advisor. Have a good day.

Thank you. On behalf of Angel One Limited, that concludes this conference. Thank you for joining us. You may now disconnect your lines.