Samriddhi Chowdhary
Vice President, ICRA Ltd
Samriddhi Chowdhary
Vice President, ICRA Ltd
Bank Brokerages to continue on growth path, riding on retail wave
Bank brokerages demonstrated a strong performance in FY2021, with a healthy growth in transaction volumes and strong uptick in earnings, supported by favourable capital markets and growing retail investor participation. This notwithstanding, bank brokerages witnessed a decline in market share, in terms of transaction volumes or active clients, primarily on account of faster growth of discount brokerages which are fast emerging as broker-of-choice for new accounts. That said, bank brokerages enjoy better brand recall, credibility and financial flexibility, by virtue of being a part of banking groups, and this would continue to support their retail franchise. Their ability to effectively ramp up digital initiatives, attract younger demographics and expand to newer geographies (such as tier II and tier III cities), however, would remain critical. ICRA expects bank brokerages to continue to report healthy earnings with 20-25% growth in NOI and 17-20% growth in profit in FY2022
