5Paisa Capital Ltd

But first, let me deep dive in the macro-economic trends seen during the year. The Indian economy continued its trajectory of healthy momentum during the year, retaining its status as the fastest-growing major economy in the world. This performance is commendable especially when viewed in the context of rising global vulnerabilities and geopolitical concerns. Continued traction in domestic demand along with comeback of rural consumption were key factors fueling the economy. A solid manufacturing sector and healthy investments in infrastructure provided further impetus. In this scenario, India's real GDP grew 8.2% in FY 2023-24, as compared to 7.2% in FY 2022-23 and exceeded expectations which ranged from 6.6% to 7.9%. Going forward, robust government capex, a rising tax-to-GDP ratio, and strong foreign investment inflowscould help drive economic growth. From here on, though, all eyes will be on RBI's stance on interest rates.

The RBI forecasts a real GDP growth of 7.2% in FY 2024-25. Improving global trade and increased integration into global supply chains will support net external demand. However, geopolitical tensions, financial market volatility, and geo-economic fragmentation pose risks to the outlook.

The Fintech revolution seems to have only begun in India with India's digital payments expected to surpass US$ 1 Trillion by 2030 (Source: Nasscom-Arthur D Little report). Presence of long-term, structural drivers, namely, government's emphasis on the cashless economy, empowering rural populace and driving inclusive growth augurs well for the fintech sector in the country. Growing income levels, continued strength in the economy, focus on innovation and an enabling regulatory environment, coupled with under-penetration of financial present a vast opportunity landscape. Improving availability of smartphones, better access to internet at higher speed connectivity are other positives. Companies with proven competitive moats and strong governance practices are well poised to benefit the most from these opportunities.

FY 2023-24 was another year of strong, all-round performance by 5paisa. Our best-in-class technological capabilities make us stand out in an otherwise crowded market. This, along with our approach of providing bespoke services to existing and newer customers works well for us. It is our constant endeavor to put our best foot forward for our esteemed patrons and to this end, we make the investments needed to further augment our capabilities across technology, people and customer service.

At 5paisa, we are also committed to contributing to society and widening our social outreach to enhance the quality of life of the underprivileged through our comprehensive CSR programs. This year, we started initiatives contributing to conservation of indigenous languages and providing employment to women from marginalized communities. Through these efforts, we have positively impacted over 2,250 lives, empowering them with skill development and a sustainable livelihood.

ROLE OF TECHNOLOGY IN BROKING ADVANCEMENTS

Digital technology is revolutionizing the broking and investment sector. Today, stockbrokers are harnessing advancements in data analysis, decision-making, and risk management to boost efficiency and deliver a more personalized user experience. AI algorithms, for example, analyze user behavior and usage patterns to provide tailored recommendations for news, research reports, and investment products. This personalized approach helps investors make informed decisions that align with their interests and goals.

Investment apps leverage AI to assess a user's portfolio and risk profile, suggesting strategies that fit their individual needs. By integrating such technology, we enhance our clients' experiences with intuitive, responsive, and highly personalized services that meet their unique financial objectives. These advancements allow brokers to make better-informed decisions, execute trades more efficiently, and manage risks more effectively. Embracing technology not only enhances service delivery but also drives greater servicesinIndia financial inclusion and improves overall market

At the end of the year under review, our app downloads grew to 18.6 Million (from 15 Million at the end of FY 2022-23) and maintained the rating of our app at 4.3 stars, reflecting high user satisfaction. We now serve more than 4.2 Million customers (up from 3.5 Million customers in FY 2022-23) and create superior experience for them constantly.

The key pillars of our strategy, namely, a) growing through mutually-rewarding partnerships (with and investment experts), b) focusing on Do-It-Yourself (DIY) customers and welcoming new investors (from tier 2 and tier 3 cities) will drive our growth from hereon. We believe there is potential to do a lot more in each of these areas and are confident of optimizing their potential

In the end, I would like to extend my heartfelt gratitude to all of you for being a constant source of strength and support in our journey so far. Our employees, customers, investors, regulators, communities and all other stakeholders are an inseparable part of our growth and we are committed to creating sustainable value for all of them. We are confident of fostering growth through innovative digital platforms in the future as well.

Message from the Managing Director & CEO

Presence of multi-year, structural drivers continued to aid performance of Indian capital markets during FY 2023-24. Benchmark indices as well as broader indices witnessed healthy momentum with Sensex and Nifty growing 25% and 29%, respectively; while BSE Midcap and Smallcap indices surging 63% and 60%, respectively. Formalization of investment management and advisory, continued financializationof savings lend strength to the tractionseenbythecapitalmarketsinthecountry. Increase in the number of demat accounts was at a record level, reflecting strong interest from retail investors in capital markets. Total number of demat accounts stood at 151.4 Million, up 32% over FY 2022-23. Another positive factor was the doubling of the monthly notional value of derivatives traded on Indian exchanges to Rs. 8,737 Trillion in March 2024 with respect to March 2023. A proactive and constantly evolving regulatory environment is going a long way in fostering participation of retail investors in the markets. Simultaneously, a robust technology ecosystem is providing high convenience and several value-adds to retail and institutional investors alike. Relatively lower penetration of financial services in India is another fundamental growth driver for the capital markets. Industry participants having solid execution capabilities and unmatched competitive moat are best placed to capitalize this opportunity landscape.

At 5paisa, we have built a resilient and scalable business model leveraging 4 key pillars. These are a) Ensuring Product Stability by building a highly available and stable system across all platforms b) Establishing a scalable Digital Funnel for optimization in lead to account opening and 30-days client activation

c) Targeted initiatives to increase engagement and Cohort-based personalized offers for existing customers

d) Development of a powerful Ecosystem for Partners and API Developers through strategic partnerships leading to a thriving Marketplace to drive various cross-sell products. With a firm gaze on maximizing these strengths, we look to foster our growth through our innovative digital platforms. Considering the increase in retail participation, high-volume traders & Algo traders and their ever-changing requirements, we are continuously working on improving our products to provide best-in-class facilities. For retail investors, we've streamlined our UI/UX across all 5paisa applications for ease of use; along with personalized research-based recommendations for higher engagement. For high-volume and Algo traders, we have implemented numerous initiatives to provide a stable, reliable, and highly available platform with low crash rates, high order throughput, and a robust API. During the year, we launched Trade Station 2.0 - our revamped web trading platform, which offers an enhanced user interface and a smoother experience for advanced traders. We've also made rapid strides in developing and enhancing our API ecosystem. Our new Xstream API ecosystem offers a dedicated landing platform, for users who want to create their own trading system with customized algos, with better collaborative capabilities and improved support for key and credential management. Additionally, our FnO 360 platform has garnered significant interest from traders because of the availability of many advanced features like bulk order placement, open interest tracking, advanced option chain, one-click strategies and detailed statistics - all essential for traders. growth in the upcoming Our performance during FY 2023-24 is a testament of our ability to bring strategy to life. Our platform saw a 39% Y-o-Y increase in total executed orders, surpassing 184 Million orders during the year and Average Daily Turnover (ADTO) exhibited rapid growth, increasing by 86% Y-o-Y to nearly Rs. 3.5 Trillion. We witnessed 69% growth in Monthly Active Users. Our revenue from operations grew by 16% to Rs. 395 Crore, while our profit after tax surged toRs. 54 crore, growing by 25% over FY 2022-23. Cash and cash equivalents grew to Rs. 1,637 Crore, driven by an increase in client margins and cash generated from the business. As we strive to deliver nothing but our best to our customers, our focus is on driving efficiencies across our product offerings, customer service and overall customer experience. Lower cost of customer acquisition coupled with state-of-the-art technology across platforms and capabilities have made us a preferred choice of new-age and veteran investors alike.

During the year, regulators continued to work towards strengthening the corporate governance practices of stockbrokers and protecting the interest of retail investors. Amendments made with regards to allocation of collaterals at an individual client level, upstreaming of client funds, ASBA and T+0 settlement all are in the right direction and will further strengthen the business practices of stock broker companies in India. As a designated Qualified Stock has diligently adhered to all guidelines mandated by NSE and BSE throughout the year concerning compliance, transparency, and disclosures, which has further strengthened our company. Our proven track record of providing innovative offerings in the discount broking space in India has held us in good stead through the ebbs and flows of various market cycles. Our solid market insights and robust execution capabilities act as the wind beneath our wings, taking us higher. We look forward to our future with zeal and optimism and are committed to providing highly reliable and seamless trading experiences to our customers and creating long-term, sustainable and holistic value for all our stakeholders.

I want to reassure our investors that we are committed to advancing product development, investing in technology, enhancing customer experiences and optimizing costs. We are optimistic about the future and the potential for sustained accelerated growth. Our focus is on innovation, delivering exceptional client experiences, and promoting sustainable business practices. We are confident that these efforts will drive revenue and profitability.

As I conclude, I'd like to warmly thank our dedicated employees for their consistent commitment and invaluable contributions. Their hard work has been vital in making our initiatives a reality. I also want to express our gratitude to our shareholders, patrons, partners, regulators and all our stakeholders for their continued support and collaboration. I solicit your continued association with 5paisa in the future.