5paisa Capital Navigates Volatile Markets with Strategic Growth and Tech Upgrades in Q2 FY26

5paisa Capital Limited has released its financial results for Q2 FY26, showcasing a mixed performance amidst a challenging market environment. The company reported a total income from operations of INR 77.3 crore, a slight dip of 1% quarter-on-quarter but a more significant 23% decline year-on-year. Profit After Tax (PAT) stood at INR 0.95 crore, marking an 18% decrease QoQ and a substantial 57% fall YoY. Earnings Before Depreciation, Tax, and Amortization (EBDTA) also saw a decline, down 16% QoQ and 54% YoY to INR 1.51 crore. These figures reflect the broader market volatility experienced during the quarter, influenced by tariff-related uncertainties, persistent FII outflows, and rising geopolitical tensions.

Despite the pressures on profitability, 5paisa demonstrated robust performance in customer acquisition and engagement. The total customer base successfully crossed the 5 million mark, reaching 50.1 lakh with a 2% QoQ growth. New customer acquisitions surged by 20% QoQ to over 95,000, while the cost of acquisition reduced by 15%, and the first-year revenue improved by 25%. This indicates a more efficient and sustainable growth model. The Average Daily Turnover (ADTO) also saw an impressive 18% QoQ increase, reaching INR 2.68 trillion, underscoring strong trading activity on the platform. Furthermore, the Mutual Fund AUM grew by 5% QoQ to INR 1,647 crore, highlighting diversification in investment products.

Strategic Initiatives and Product Enhancements

5paisa Capital Limited continues to prioritize technological innovation and product development to enhance user experience and trading efficiency. Key initiatives launched during the quarter include the Scalper Platform on the web, designed for high-frequency traders with ultra-fast execution and intuitive controls. The company also upgraded its digital onboarding process, incorporating PAN autofill, PIN-less DigiLocker access, and secure digital KYC for a seamless experience. The MTF universe was expanded to over 1,200 scrips, introducing a 'Pay Later' option with lower interest rates and unlimited holding periods.

Additionally, 5paisa launched a Strategy Analyzer and Alpha Scan on its FNO360 platform, offering over 50 pre-built stock scanners, payoff charts, and combined open interest insights to empower traders with better decision-making tools. A dedicated ETF Dashboard was introduced for smarter investing, and SEBI-compliant UPI handles were implemented for faster and more secure payments. The management emphasized that these upgrades are part of a broader core tech transformation, including re-platforming their core system, expected to conclude in the next quarter, to improve speed, analytics, and platform depth.

Management Outlook and Market Dynamics

The management acknowledged the impact of market volatility on overall revenue and profitability. Foreign institutional investors recorded net outflows exceeding $10 billion, while domestic institutional investors saw inflows of over$20 billion, providing a counterbalancing force. Despite the industry-wide moderation in ADTO, 5paisa's average daily turnover increased, indicating strong engagement from its active customer base.

The company's strategy focuses on cost-efficient customer acquisition and ensuring a strong lifetime value from each customer. They are committed to continuous innovation, strengthening their product and technology stack, and leveraging AI to further enhance customer experience. While not providing explicit forward-looking statements due to market dependency, management expressed optimism for a better H2 FY26, contingent on market support. The re-platforming of the core system is a strategic move to build a robust foundation for future growth and competitive advantage.

In conclusion, 5paisa Capital Limited's Q2 FY26 performance reflects a company actively adapting to market challenges through strategic product innovation and efficient customer growth. Despite short-term profitability pressures, the focus on technological upgrades and enhanced user experience positions the company for long-term resilience and sustained stakeholder value.