Delhi trading house handles half of IBEX volume
Delhi-headquartered SMC Global Securities Ltd is riding on bullish market trends, dominating gold trade at the GIFT City’s IBEX and working on capturing more of the foreign investment portfolio participation in India’s equity and derivative markets.
Foreign portfolio investors’ (FPIs) participation in the Indian equity and derivative markets is increasing on a daily basis while new Indian investors from tier-3 and tier-4 cities are set to create a significant expansion-mode influence in the domestic stock-and-share markets, says a senior broker.
“While FPIs are banking on steady returns on their investments which is backed by the country’s projected steady economic growth in the years ahead, we are expecting participation from new Indian traders to contribute significantly to the multi-fold increase in trading volume over the next five years,” said Ajay Garg, Director and CEO of SMC Global Securities Ltd.
There is a lot of foreign interest in the Indian market, especially FPIs participating in the HFT and MFT (high frequency and medium frequency) trading, he said, adding that SMC is currently serving around 60 FPIs and more have lined up to become members of the group.
Garg said that SMC is working on capturing more FPI business, given that the company has registered more than 160 FPI and FDI clients on its platform, although few may take a while to start trade.
Currently, over 11,800 FPIs which includes 3,500 FPIs from the United States, have invested in US$1.1 trillion assets in India, estimated Garg.
“SMC is focusing on US-based traders as the NSE has the approval from CFTC (Commodity Futures Trading Commission) to market Nifty F&O to US-based investors,” he said at the Asia conference held by the Futures Industries Association of the United States in Singapore 4-6 Dec 2024.
He also highlighted the US$800 billion Mutual Fund AUM, saying “these opportunities make India an attractive destination for FPIs.”
The domestic investors, specifically the tier-3 and tier-4 mobile-savvy young traders are going to add significantly to the daily NSE-BSE volumes, benefiting from the wide reach of mobile-based apps, said Garg.
“Given that India has one of the fastest growing economies in the world, the outlook for equity and derivative markets looks very bright,” Press Trust of India quoted Garg as saying.
“But investor penetration by Indians in the financial markets is still nominal, at less than 5%,” he pointed out.
Demat account holders grew to 17 crore these days, from the low of 4 crores in the pre-Covid times, he said.
More than 50% of the new clients now come from tier-3 and tier-4 cities, according to Garg.
SMC has been enjoying 20.28% CAGR growth in PAT over the last five years benefitting from its network spread across 425 Indian cities and serving from around 2,500 offices, including 2,300 franchise offices.
Combined NSE and BSE, have delivered an astounding 15.43% CAGR over 20 years, which in itself is a sign of remarkable performance and potential for growth, he pointed out.
Garg also highlighted SMC’s success at the International Indian Bullion Exchange (IIBX) in GIFT City
“We are one of the leading clearing and trading members of GIFT City. We have handled 26 million tons of physical gold imports out of the 52 million tons imported in 2023-24 at the IIBX,” he said.
Gold, he pointed out, “still remains safe and favourite among Indian investors.” Fiinews.com
