Small investors back

Growth in accounts signals return of small investors

The ongoing bull market rally in the equity market has finally started attracting small investors into the market, which is corroborated by the fact that both the depositories in India have seen a robust growth in new account opening this financial year. According to market experts, the robust growth in the number of new accounts opening signals the return of the small investors into the equity market.

While the Central Depository Services Ltd (CDSL) has added over 4.23 lakh new accounts taking its total investor accounts to 92 lakh, the National Securities Depository Ltd (NSDL) has added 3.30 lakh accounts during this financial year taking its total to 1.33 crore investor accounts.

“We have added about 22,000 fresh accounts this financial year,” said Amit Majumdar, executive director and chief strategy officer at Angel Broking, which focuses on retail and high net worth investors. According to him, the average daily trading volumes by retail investors have grown threefold during this financial year.

“During FY13 and FY14, the average delivery based transaction per day stood at `60 – `70 crore in our firm. However, this has now grown to `200 crore per day. The trading momentum picked up pace especially after May 2014,” he said and added that his company has seen a 7 per cent average growth in new account opening in FY15 as compared to a 3 – 3.5 per cent growth witnessed during last two fiscals.

“We have seen a substantial increase in new client acquisition, which is 2.5-3 times more than what we saw last year. Out of the total new account openings, about 50-60 per cent customers are new to the equity market. The remaining set of investors would have exposure to the equity market either through MFs or other routes,” noted B. Gopakumar, EVP and head of broking, Kotak Securities.