The aggregate Indian broking industry size stood at INR 210 billion in FY2020, registering a growth of 8% over INR 195 billion in FY2019. The industry is expected to hit INR 230 billion in FY2021 at a YoY growth rate of 9.5% (Source: ICRA), inspite of India’s GDP estimated to decline by 9.6% in FY2021 as per the World Bank. The BSE Sensex declined 28.7% in the first 3 months of CY2020 due to rising concerns related to the COVID-19 pandemic. However, it has rebounded by almost 51.4% from then, despite declining economic conditions. The COVID-19 pandemic turned out to be a boon in disguise as the industry saw the total number of Demat accounts rose to 46.1 million as of September 2020 from 40.8 million in March 2020, an increase of annualized 26%.
However, the industry is reeling under several challenges including:
- The industry is suffering from saturation and standardization of offerings. There isn’t much differentiation of service.
- Access to the fund managers for new or budding institutional brokers is a challenge limiting their business revenue potential.
- The entry of modern age discount brokers has given the traditional brokers a run for their money. Discount brokers come with a fee-based business model as against the traditional transaction-based model.
- Broking firms are expected to increase the funding requirements to maintain adequate margins at the exchanges.
- Standardization of cash segment margin is expected to limit the ability of brokers to offer additional value propositions like flexible payment terms, credit to their clients.
- The research function is still looked upon as a cost centre. It reels under the constant pressure of churning new ideas, expanded coverage, in-depth and timely research, creative publications, amidst limited budgets.
- High attrition is a chronic issue especially at the associate and below level, leading to delays in new stock originations, gaps in coverage maintenance, loss of knowledge repository, and a huge opportunity cost for the Head of Research (HoR) and Senior Research Analyst, as the whole time and energy go in the drain.
More read - https://www.valueadd-research.com/blog/indian-broking-industry/
Agriculture is considered as the backbone of the Indian economy as 50% of the total population earns their living by means of agriculture and it is contributing about 17% to the total GDP of the nation.
From the beginning of 1970, the green revolution put some major effects in terms of production
IHSG - Composite Stock Price index or the INDEX on the first trading session today, Tuesday (17/12), closed index edged up 0.02% to 6.212.
The index along the first session of this move varies and had to be in the red zone.
Based on data from the RTI Infokom, the total volume of shares traded up to the first session as much as 4,82 billion shares, with a transaction value of Rp 3.36 trillion and the frequency of 296 thousand times.
Recorded 157 stocks rose, 204 stocks fell, and 156 were little changed.
(Read: the JCI Today is Predicted to Weaken, Following the Recommendations of Stock Analysts)
However, the rate of positive is restrained by the prices of other stocks such as Adaro Energy or ADRO that deal fell 3.66% in to Usd 1.580 per share and Bukit Asam or PTBA down 2,23% to a level of Usd 2.630 per share.
