New Investor Addition Slumps In March As Market Slowdown Looms
The top five states accounted for 48.9% of the new additions during the year, with Maharashtra in lead, accounting for 1.6 crore investors added, at 17.2% of total.
India's investment landscape has shown resilient growth in an era marked by fluctuating markets and economic uncertainty on a global scale, particularly in terms of new investor additions. Fiscal 2024 saw a steady rise in investor base, ending the year at a figure of 9.15 crore, a rise of nearly 26% since last year.
The top five states accounted for 48.9% of the new additions during the year, led by Maharashtra at 17.2%, or an addition of 1.6 crore investors.
Uttar Pradesh took the second sport with 99.1 lakh investors as of March end, followed by Gujarat, West Bengal, and Karnataka.
Investor base hit a milestone of 9 crore in March, taking only five months to add the last crore, while taking eight months to go from 7 to 8 crore and nine months to go from 6 to 7 crore.
"This rise can be attributed to the multiple highs seen during FY24 as Nifty crossed the 22,000 mark, with close to 29% returns in FY24," according to a report by the National Stock Exchange of India.
Despite commanding the highest share of investor additions during the year, the month of March saw the pace of new additions moderate for the top states.
The last month of FY24 saw 15.8 lakh new investor registrations, lower than the 21.6 lakh new additions in February. This slowdown was apparent across regions, with West India experiencing a notable 31% decrease in new additions.
Uttar Pradesh continued to lead with 2.4 lakh new registrations, despite a significant decline of 26% month-on-month.
Maharashtra took second place with 2 lakh new registrations, a 30.9% dip sequentially. New registrations in Gujarat also fell by 7% MoM in March.
West Bengal, Bihar and Tamil Nadu also saw a slowing pace of additions during the month.
This dip aligns with declines in market participation. Turnover in cash markets and equity derivatives saw significant reductions in March, with cash markets dropping 24% to an average daily turnover of less than Rs 1 lakh crore. Similarly, participation numbers fell, with cash market participants decreasing by 19%.
