Angel One Ltd Valuation Shifts to Fair Territory Amid Market Volatility

Valuation Metrics Reflect Improved Price Appeal

Angel One’s price-to-earnings (P/E) ratio currently stands at 29.74, a figure that positions the stock within a fair valuation range compared to its previous expensive rating. This is a significant moderation from prior levels, signalling a more balanced price relative to earnings. The price-to-book value (P/BV) ratio also supports this view, at 3.94, indicating that the stock is trading at just under four times its book value, a level that is more palatable for investors seeking value in the capital markets sector.

Further valuation multiples such as the enterprise value to EBITDA (EV/EBITDA) ratio at 10.48 and enterprise value to EBIT (EV/EBIT) at 11.36 reinforce the notion of fair pricing. These multiples are notably lower than many peers in the sector, some of whom are trading at significantly higher valuations. For instance, Go Digit General and Star Health Insurance are both classified as very expensive, with P/E ratios exceeding 60 and EV/EBITDA multiples well above 40, underscoring Angel One’s relative valuation advantage.

Comparative Peer Analysis Highlights Relative Value

When benchmarked against its peer group, Angel One’s valuation metrics stand out as more reasonable. While companies like Manappuram Finance and Anand Rathi Wealth Management are trading at P/E ratios above 60 and EV/EBITDA multiples in the double digits, Angel One’s more moderate multiples suggest a less stretched valuation. Even within the capital markets sector, where valuations can be volatile, Angel One’s current multiples offer a more attractive entry point for investors wary of overpaying.

Moreover, the company’s PEG ratio is reported as zero, which may reflect a lack of consensus on growth expectations or a temporary data anomaly. Nonetheless, the dividend yield of 2.38% provides a modest income component, enhancing the stock’s appeal for income-focused investors.

Financial Performance and Returns Contextualise Valuation

Angel One’s return metrics over various time horizons provide further context to its valuation. The stock has delivered an impressive 126.45% return over three years and a staggering 675.45% over five years, vastly outperforming the Sensex’s 35.24% and 62.11% returns over the same periods respectively. This long-term outperformance justifies a premium to the broader market, yet the recent valuation moderation suggests the stock is no longer excessively priced.

Year-to-date, Angel One has posted a 7.4% gain, outperforming the Sensex’s negative 3.19% return, although it has experienced short-term weakness with an 8.47% decline over the past week. This volatility is not uncommon in the capital markets sector, which is sensitive to macroeconomic factors and regulatory developments.

Quality and Profitability Metrics Signal Mixed Signals

On the profitability front, Angel One reports a return on equity (ROE) of 13.46%, a respectable figure that indicates efficient utilisation of shareholder capital. However, the return on capital employed (ROCE) is flagged as negative due to negative capital employed, which warrants caution. This anomaly may be linked to accounting treatments or recent balance sheet adjustments and should be monitored closely by investors.

Despite this, the company’s market capitalisation grade remains modest at 3, reflecting a mid-sized market cap that may appeal to investors seeking growth potential without the volatility of smaller caps.

Price Movement and Trading Range

Angel One’s current market price is ₹2,517.50, down 2.72% on the day from a previous close of ₹2,588.00. The stock has traded within a 52-week range of ₹1,942.00 to ₹3,283.00, indicating a wide trading band and potential for both upside and downside volatility. Today’s intraday range between ₹2,502.95 and ₹2,618.80 further reflects this price fluctuation.

Mojo Score and Analyst Ratings Reflect Caution

Angel One’s current Mojo Score is 47.0, accompanied by a Mojo Grade of Sell, downgraded from Hold as of 27 January 2026. This downgrade reflects a more cautious stance by analysts, likely influenced by recent price declines and mixed financial signals. The downgrade serves as a reminder that while valuation has become more attractive, risks remain, particularly in the context of sector volatility and company-specific challenges.

Investors should weigh these factors carefully, balancing the stock’s improved valuation against the broader market environment and peer valuations. The capital markets sector continues to face headwinds from regulatory changes and macroeconomic uncertainties, which could impact earnings visibility and investor sentiment.

Conclusion: A More Balanced Valuation Amid Sector Challenges

Angel One Ltd’s shift from an expensive to a fair valuation grade marks a significant development for investors seeking exposure to the capital markets sector. The moderation in P/E and P/BV ratios, alongside reasonable EV/EBITDA multiples, positions the stock as a more attractive option relative to its historically stretched valuations and many of its peers.

However, the downgrade in analyst rating to Sell and the negative ROCE highlight ongoing risks that investors must consider. The stock’s strong long-term returns and dividend yield provide some comfort, but short-term volatility and sector-specific challenges remain pertinent.

Overall, Angel One’s current valuation landscape suggests a more balanced risk-reward profile, making it a candidate for selective consideration within a diversified portfolio, particularly for investors with a medium to long-term horizon and a tolerance for sector cyclicality.

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