Thanks to technological leaps after the 2008 global meltdown, and return of the NDA Government at the Centre under the leadership of a tech-savvy Prime Minister, India’s capital market has entered the 'Achchhe Din' era. And how!
In the last 100 days of the Narendra Modi Government, many retail investors have returned to the capital market, some even by dissolving their fixed deposits.
“Trading volumes on our platform have gone up by 20-30 per cent in the last 100 days, and many retail investors are now managing their own portfolios,” B Gopkumar, Executive Vice-President and Head, Broking, Kotak Securities Ltd (KSL), told
The main reason for the retailer’s renewed interest, he said, was the freedom he got due to upgradation in telecommunication technology.
Some 50 per cent of KSL’s investors have shifted to online, direct transaction, instead of through brokers/sub-brokers. Also, 10 per cent of online transactions now occur through mobile telephony with smartphones becoming affordable. “Now a potential investor can buy a smartphone for just Rs 2,500, liberating him even from a computer or laptop.”
Broking companies
Broking companies, which had gone broke after the 2008 global meltdown, are also returning to business. The number of Kotak Securities' dealers has increased by 20 per cent in the last 100 days and is expected to go up by another 10 per cent in the next three months. However, for now, only HNIs are making deals through dealers, with small retailers doing it, increasingly, on their own, he said.
Quick transactions
Technology upgradation from 2G to 3G has made the capital market accessible to many investors. “Although our systems are compatible even with 2G, introduction of 3G has accelerated transaction. Also, a customer can now open account with KSL in 30 minutes and we take just 18 seconds to process the request,” he said.
'StartNow' campaign
Recently, Kotak Securities rolled out a 'StartNow' campaign to advise retail investors to start investment. “An investor prefers knowledge-support and access across devices to markets.”
It has also rolled out a TV commercial in eight languages. KSL processes over five lakh secondary market trades every day and has a customer base of nearly 9.60 lakh customers, including 1.06 lakh in Gujarat.
Kotak Securities survey
In an online survey KSL conducted on 2,500 customers in July 2014, the company found that 47 per cent of respondents had to learn about investing on their own, 21 per cent were confident when they started investing, 86 per cent thought that information and technology gave them the confidence to invest and 79 per cent felt the need to be connected to the markets, while on the move.
Also, 74 per cent of respondents thought for more than a month before opening a broking account and 77 per cent felt they could now get the best software for trading on mobile phones and desktops.
KSL, a subsidiary of Kotak Mahindra Bank Ltd and stock broking arm of Kotak Mahindra Group, provides the latest platform for capital market transaction.
It is all set to increase the number of its branches in Gujarat, its second largest market after Maharashtra, from 16 to 21, and staff from 150 to 200 in the next couple of months. Of the existing 1,147 outlets across India, KSL owns nearly 200, the rest being franchisees.