Restructuring may hit 350 Sharekhan staff

Sharekhan, which is one of the top five brokerages in India, is going through a restructuring process that could impact 350 employees. A spokesperson for BNP Paribas India said: “Our business is evolving to meet the more complex needs of clients, including through the provision of value-added advisory services, for which we have been hiring.”

“In line with our clients’ expectations, we have moved to provide more digital services. Through this digitalisation and restructuring, which will continue in a phased manner over the next few months, around 350 colleagues are impacted,” he added.

Market sources said other brokerages are also looking to streamline their business models as market volatility, along with increasing competition, has taken a toll on earning yields. Experts say the brokerage industry is getting more competitive due to the entry of discount brokers that offer broking services at fixed fees.

Analysts add that traditional brokerages will have to revisit their strategies amid heightened competition. Volumes in equity markets — where brokerage yields tend to be higher — have grown at a slower pace, unlike the derivatives markets.

According to Motilal Oswal Financial Services, the average daily traded volumes in the cash market saw 7 per cent growth year-on-year in FY19.

The growth in cash markets has been hit by a fall in delivery volumes, which saw de-growth of 8.2 per cent to ~8,854 crore. Last fiscal, the segment had grown 26 per cent.