In interaction with Mr. Prakarsh Gagdani, CEO, 5paisa.com
Speaking with DSIJ, Mr. Prakarsh Gagdani, CEO, 5paisa.com indicates that the company is looking forward to an upward spiral in its business. Following is the detailed discussion.
How is the market share growing for 5 Paisa.com?
The previous year has been a historical one in terms of business where overall the brokerage industry experienced exponential growth and we also managed to do well with keeping up our market share. We are a multiproduct platform offering financial products that can be served end-to-end online with minimal human intervention. Our offering ranges from trading and investments in gold and insurance to P2P lending and international investments from India. These products, coupled with services like the research tools we offer, should pretty much help us drive our share.
What is your outlook on the broking industry in India?
The outlook for the broking industry is extremely positive. The pandemic has acted like an inflection point for the dematerialisation account growth in the country. Since then the numbers have exploded. Looking at the industry trends, we are confident that this growth that has come after the onset of the pandemic will continue as more and more young millennials approach the capital market and make equity investments their primary investment. So our outlook is extremely bright.
Are an increasing number of retail investors participating in the equity markets?
Yes, retail participation in the equity market is high. It is on the back of strong dematerialisation growth, which is the best year in a long time in terms of new client additions. The second parameter is the participation of retails in IPOs. For instance, the Happiest Minds IPO was subscribed 150.98 times in September and the Route Mobile IPO that was open for subscription from September 9 and 11 was subscribed almost 73.3 times.
Similarly, Chemcon Specialty Chemicals Ltd. was subscribed almost 149 times on the final day of bidding in the same month. The third factor is that new millennials are participating from Tier II and III cities. States that were hitherto lagging in the equity market have now started investing in the capital market. So we have an increasing number of retail investors from unexplored areas now participating in the stock markets. One more reason is that the folios in mutual funds have crossed around 60 million now, which is also a good driving factor.
What is your estimate for 2021 in terms of new dematerialisation accounts?
It is really difficult to predict the estimate in terms of growth because in the year 2019 and 2020 there has been a significant spike. Obviously, the percentage growth might not match because of the factors that drove the growth then, but in absolute terms we are confident of growth as compared to last year.
What are your growth levers, and can you explain how you intend to achieve your internal growth targets?
Our growth levers include the organic traffic and organic account opening owing to the references through our strategic partnership and the digital marketing we do.