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Business News/ Markets / Stock Markets/  Upstox shoots past rivals as discount brokers strengthen their hold

Discount brokers are strengthening their hold on India’s highly competitive stock broking industry, with another such firm surpassing all the traditional rivals amid the coronavirus pandemic-related restrictions.

Tiger Global Management-backed RKSV Securities India Pvt. became the second-biggest broker in the country after nearly doubling the number of its customers to 1.2 million in the six months through September, data compiled by National Stock Exchange of India Ltd. shows. Top online broker Zerodha Broking Ltd. also grew the number of clients by 75% to 2.5 million. In comparison, traditional brokers such as ICICI Securities Ltd. and HDFC Securities Ltd. saw meager additions.

A nationwide lockdown to contain the spread of the coronavirus pandemic has lured millions of new investors into equities, helping drive a more than 55% surge in India’s benchmark S&P BSE Sensex from its lows in March. Online brokerages, which charge lower fees, were able to attract most of the new clients than shop-face operators, which faced significant logistics hurdles due to lockdown rules, according to a note by ICRA Ltd., the local unit of Moody’s Investors Service.

Online broker RKSV doubles its clients since March lockdown
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Online broker RKSV doubles its clients since March lockdown

Sales at Indian brokers may grow as much as 12% to about 23,000 crore ($3.14 billion) in the year to March 2021, ICRA forecast in a note published last month.

“The golden days are still ahead," said Ravi Kumar, who co-founded 11-year-old RKSV Securities. “Equity participation is 3% or 4% so we’ve barely scratched the surface. People are working from home and they have more time to take care of their finances so that’s helping us open even more accounts than earlier."

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This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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Updated: 12 Oct 2020, 04:39 PM IST
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