The report titled “India Financial Brokerage Market Outlook to 2020-Evolvement of Discount Brokers and Robust Trading Volume to Prosper Market Growth” provides a comprehensive analysis of Financial Brokerage market in India. The report focuses on the full service brokers and discount brokers separately in detail. The report covers market size and segmentation of overall financial brokerage market by online/offline mode, FIIs and Domestic Investors, Trading exchange each by Equity, Commodities and Currencies and various segmentations on each trading segment. The report covers comparison of online trading with offline trading in India, with the consumer survey regarding the preferences for online trading by different population groups. The report puts forth in-depth analysis on Full Service brokers including business models, market share of major players and detailed company profile for each major full service brokers. The potential and future outlook for full service brokers has also been discussed in the publication. Discount broking market in India has been separately discussed in the report with detailed analysis of major players, their strategies relative to global discount brokers, company profiles for major players, SWOT Analysis and major issues and challenges with the discount broking market in India. The report covers analysis on the process for discount broker to tie up with technology partners to serve retail customers. The report also serves as a benchmark for every new player which is seeking to enter into financial brokerage market and what should be the focus and USP for that new player.
India Financial Brokerage Market
In the financial brokerage market, equity segment has dominated the overall market in terms of transaction volume with a share of ~% during FY’2015. During the span of last five years, the share of equity has widely improved from ~% share in transaction volume being recorded in FY’2010. During FY’2015, trading from NSE exchange has dominated the currency derivatives market, with a share of ~%. This has translated the trading volume to INR ~ trillion in the same fiscal year.
India Full Service Brokerage Market
The revenues generated by full service brokers have enhanced at a CAGR of ~% during the period FY’2010-FY’2015. The rise in trading volume has consistently led to increase in revenues engendered by these players. Moreover, the shift of trading platform from offline to both online-offline has also surged the revenues countered by full service brokers. However, the future for full service brokers has been showcasing unstable growth, since these companies are losing a significant share to the discount brokers in India. Developing and marketing their ability to help customers meet their goals with a suite of products and services will continue to strengthen their relationships over the long term. ICICI Securities have been the largest players in full service brokerage market, which was contributed by having highest number of clients relative to other peers. Owing to the competition been increased from discount brokers in the form of lower brokerage charges, the full service brokers have shifted their strategy to boost revenues from non brokerage segment. Asset management services, Portfolio management services, insurance broking and mutual funds are the non brokerage segment where these full services brokers have started to focus
While offline clients are typically large ticketsize customers who track the market closely and want a physical interface with the broker, online clients are predominantly retail investors who trade on their own. Over the medium to long term, the outcomes of various impending structural changes in the broking industry such as outlook and potential of discount broking is likely to have crucial bearing on broking profitability.
India Discount Brokerage Market
The concept of discount broking in India was fetched from US, where 70% of retail volume happens through discount brokers. In India, the trend has caught up well, with discount brokers contributing ~% of the total market turnover currently. The cost of running a broking business in terms of technology, real estate, compliances and marketing has gone up drastically and at the same time, the revenue from brokerage has come down. In such a scenario, the discount broking space was poised to record growth in the market. The market for discount broking has showcased a phenomenal growth by growing at a CAGR of ~% during the period FY’2013-FY’2015. It has been witnessed that more than ~ customers have moved to discount brokers over the last 3 years. This is backed by the fact that in FY’2013, the discount brokers contributed around ~% of the total revenue of the broking industry which had increased to ~% in FY’2015.
India has over 15 discount brokering companies. And now, with discount brokerage hitting the digital space, brokers now have access to a larger number of clients. Zerodha was the first company which has incepted the concept of discount broking in India. The company has dominated the overall market and thus has accounted share worth ~% during FY’2015 in terms of revenues. RKSV Securities is the other major player in the discount broking market and have posted a revenue share worth ~% during FY’2015
As technology is growing and increase in use of internet, smartphones, and mobile apps as well as the evolvement of lower brokerage has led discount brokers to gain momentum in the market in the coming future. Volumes are going to be on the higher side. However, it is likely to take time before it could be witnessed the kind of volume that are required for discount brokerage model to succeed. Projections for the future suggest that the discount broking market is anticipated to witness a phenomenal CAGR of ~% during the period FY’2016-FY’2020. This will lead the market to over INR 20 billion by FY’2020.
Key Topics Covered in the Report:
- Comparative Analysis of India Financial Brokerage Market with Global Market
- Educational Training Programs in India Brokerage Market
- Financial Brokerage Market Size
- By Revenues
- BY Transaction Volume
- Market Segmentation of Financial Brokerage Market by Online/Offline Mode, FIIs and Domestic Investors, Equity, Commodities and Currencies on the Basis of Transaction Volume, Equity (Cash and Derivatives), Cash Market (Intra Day or Delivery Based Transactions), by Major Cities and others
- India Full Service Brokerage Market Introduction and Size by Revenues
- Business Model and Issues and Challenges in Full Service Brokerage Market
- Market Share and Detailed Company Profiles for Full Service Brokers in India
- Future Outlook and Projections for Full Service Brokers in India
- India Discount Brokerage Market Introduction and Size by Revenues and Transaction Volume
- Business Models in India Discount Brokerage Market
- Strategies Adopted by Discount Brokers in Global Market
- Market Share and Detailed Company Profiles for Discount Brokers in India
- Future Outlook and Projections for Discount Brokers in India
- How Discount Brokers can tie up with major Technology companies to Serve Retail Customers
- Government Regulation in the Market
- Growth Drivers in Financial Brokerage Market
- Analyst Recommendations
Ankur Gupta, Head Marketing & Communications