Axis Securities, IIFL Securities Bag Karvy’s Broking, Demat Accounts
Axis Securities Ltd. and IIFL Securities Ltd. have won bids to acquire trading and demat accounts held by Karvy Stock Broking Ltd.
Axis Securities emerged as the successful bidder for trading accounts (broking accounts) held by Karvy with the National Stock Exchange, BSE, and Metropolitan Stock Exchange, it said in a media statement. “Once the process is complete, the customer base of Axis Securities will surge from 2.5 million to over 3.6 million.”
IIFL Securities, according to an exchange filing, emerged as the successful bidder for demat accounts held by Karvy with Central Depository Services Ltd. and National Securities Depository Ltd. The brokerage will acquire 11.06 lakh demat accounts, of which 3.82 lakh were with CDSL and 7.23 lakh with NSDL.
The said transfer of broking and demat accounts is subject to remittance of the bid amount and submission of the necessary documents, the statements said.
Karvy in November 2019 was barred by the Securities and Exchange Board of India from signing up new customers for allegedly unauthorisedly pledging client shares to raise funds for its own use. A month later, the NSE barred the broker from participating in the cash market, equity, commodity and currency derivative, debt and mutual fund service system segments for not complying with regulatory norms. In November 2020, the NSE declared Karvy as a defaulter for non-compliance with the regulatory provisions of the bourse.
Shares of IIFL Securities ended 20% higher on Wednesday—the biggest single-day gain since listing in September 2019—at Rs 56.40 apiece. That’s also the highest level in seven months.