HDFC Securities Limited Unlisted Shares

Annual Report Summary

Innovating and Adapting for Success: HDFC Securities Annual Report 2024

Overview: HDFC Securities, a subsidiary of HDFC Bank, emphasizes innovation and technology in India’s stock broking sector. Since its establishment in 2000, it has aimed to meet the diverse needs of retail and institutional investors.

Key Highlights:

• Market Growth: India is projected to become the third-largest economy by 2027. The number of demat accounts reached 151 million in March 2024, with an average of 3.1 million new accounts opened monthly.
• HDFC SKY Launch: HDFC Securities launched HDFC SKY, a mobile trading app designed to support investors with various trading instruments and real-time market data. The app features caution nudges, customizable watchlists, and a flat pricing model.
• InvestRight: The InvestRight app offers tools for making informed investment decisions, featuring real-time event updates and research-backed information.

Financial Performance:

• Brokerage and Fee Income: Increased to ₹1,597 crore in FY24.
• Profit After Tax (PAT): Increased to ₹951 crore in FY24.
• Earnings Per Share (EPS): Increased to ₹597 in FY24.
• Total Active Clients: Reached 1.21 million.
• Dividend Per Share: ₹510 in FY24.
• CSR Spend: ₹22.06 crore.

Business Highlights for FY 23-24:

• Digital Brokerage: 84% of brokerage attributed to digital sources.
• Customer Base: 53,82,198.
• Experienced Employees: Over 700 employees with 5+ years at HDFC Securities.
• Trading Clients: 12,14,713 transacting clients.
• MTF Book Size: ₹4,855 Cr.
• Book Size at Year-End: ₹6,033 Cr.
• Revenue per Employee: ₹84.54 lacs.
• Active Transacting Clients: 1.09 million.
• IPO Volume: ₹1,19,790.84 Cr.
• Total Number of RMs: 1,400+.
• Average Daily Turnover Increase: 113.42%.

Strategic Direction and Initiatives:

• Technology Investment: HDFC Securities focuses on technology to enhance trading platforms and features, aiming to provide a comprehensive experience to investors.
• Expansion to GIFT City: The company is setting up a subsidiary in Gujarat International Finance Tec-City.
• Customer-Centric Solutions: The firm offers tailored products and services to meet diverse customer needs, including those of millennials, professionals, and senior citizens.

Regulatory Compliance:

• The company geared up systems and processes according to SEBI's regulatory guidelines.
• Regulatory changes are leveraged for strategic advantage, including T+0 settlement implementation.

Growth & Future Outlook:

• The company reported a 2.5-fold growth in profitability over the past 4 years. The number of customers has crossed the 5 million mark.
• The finance ministry expects the country’s GDP to more than double from $3.5 trillion to $7.3 trillion by 2030.

Third-Party Investment Success:

• Mutual Fund: Established as one of the highest contributors among NDs in NFO business and doubled the SIP registration numbers.
• SGB: Strengthened distributor position with BSE.

B2B Synergy:

• Leveraged technology to enhance partner onboarding and provide high-tech upgrades to AP model.

Social Responsibility:

• HDFC Securities engages in Corporate Social Responsibility (CSR) projects, focusing on education, healthcare, and environmental concerns.

Board and Management:

• The report includes profiles of the Board members, including Neeraj Swaroop (Chairman), Dhiraj Relli (Managing Director & CEO), and independent directors such as Samir Bhatia and Malay Patel.
• It also lists the senior management team.

Financial Statements & Audit:

• The report includes audited financial statements as per IND AS, highlighting Total Income, Profit After Tax, and key financial positions.
• Auditor's report by S.R. Batliboi & Co. LLP emphasizes compliance with accounting standards and internal financial controls. A Qualified Opinion regarding internal financial controls.

Additional Points:

• Details of board meetings, composition of committees, and compliance with regulatory requirements are provided.
• Detailed information on CSR activities, including project details and expenditure, is included.
• The report also covers details of remuneration policies, employee stock options, and material related-party transactions.

The Indian economy is expected to grow strongly, supported by favorable conditions and government initiatives. HDFC Securities is committed to supporting financial inclusion and delivering value to its stakeholders.