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Highlighting this growth, Nithin Kamath, co-founder and CEO of Zerodha, a stock broking platform, stated that much of this increase has been seen in the last three to four years. He credited the exchanges, particularly NSE, for contributing significantly to the pace of financialization in India.
The NSE also revealed that 45% of these new investors are from cities outside the top 100 urban centers in India, countering the common belief that stock market participation is limited to major cities. A regional breakdown showed that most new investors are from North India, accounting for 43%, followed by West India with 27%, South India with 17%, and East India with 13%.
Regarding unique PAN investors and households, the 80 million unique PAN investors correspond to roughly 50 million unique households across India. Approximately 17% of these households are directly investing in the Indian stock market through NSE’s extensive nationwide network of trading members.
In terms of performance, the Nifty 50 index has delivered an annualized return of 22.66% over the past three years, while the Nifty 500 index has posted an annualized return of 25% during the same period.
Historical data from NSE shows a rising trend in new registrations. There have been 7.6 million new investor registrations in the first six months of the current financial year alone. For context, new investor registrations were at 13 million in FY23, 19 million in FY22, and 9 million in FY21.
In related news, Kamath also highlighted that the total Sovereign Gold Bonds (SGBs) issued so far in the current financial year is approximately 10% of the total gold imports. He pointed out that this keeps money within the country and potentially introduces many new investors to other investment opportunities. So far in the current financial year 2024, total SGBs worth Rs 11,518.57 crore (Rs 1 crore = $120,252) have been subscribed, compared to gold imports worth Rs 1,08,548.61 crore. In the last fiscal year, this figure stood at Rs 6,550.66 crore compared to gold imports worth Rs 2,80,481.73 crore.
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