March demat account additions well below FY22 average, says MOSL; here's how major brokers performed

Amid the uncertainty in the market, a report by brokerage house Motilal Oswal stated that demat account additions fell 8 percent month-on-month (MoM) in March to 19 lakh. This figure is considerably lower than the average of 29 lakh new accounts added in FY22, it said.

Overall, India’s total demat accounts rose to 11.4 crore in March 2023, up 28 percent year-on-year (YoY) and 2 percent MoM.

Equity market sentiment was volatile in March 2023, with the Nifty hovering in the lower 17,000s for most of the month.

NSE accounts also decline

Also, the number of active users on NSE declined for the ninth consecutive month to 3.26 crore in March 2023, down 2.7 percent MoM (9.4 percent YoY) from 3.36 crore in February, noted the brokerage. As per the report, the top five discount brokers accounted for 60 percent of the overall active clients on NSE in March from 59.6 percent in February.

However, MOSL informed that in terms of the total and incremental demat account market share, CDSL continues to gain on an MoM basis. On a YoY basis, NSDL lost 230bp/730bp market share in total/incremental demat accounts, it said.

Average daily turnover

MOSL also stated that in the futures and options (F&O) segment, the average daily turnover (ADTO) jumped 146 percent YoY to ₹237 lakh crore and 13 percent MoM.

Retail cash ADTO in March 2023 was flat MoM at ₹23,700 crore, whereas retail F&O ADTO grew 12.5 percent MoM in March 2023 to ₹87 lakh crore.

Performance of major discount brokers by MOSL

The report pointed out that Angel One, which relies heavily on income from F&O, experienced a sharp 18.5 percent MoM increase in its daily orders. Meanwhile, it reported a 0.3 percent MoM increase in its client count to 43 lakh, with a 39 bps rise in market share to 13.1 percent.

Apart from Angel One, in the top 5 discount brokers, only Groww reported a rise in its clients and market share, other major brokerages witnessed a decline in client additions, observed MOSL.

Groww reported a 1.4 percent MoM increase in its client count to 54 lakh, with a 66 bps rise in market share to 16.5 percent.

Zerodha, on the other hand, witnessed a 0.8 percent MoM decline in its client count to 64 lakh, however, its market share rose by 37 bps to 19.6 percent.

Upstox also reported an 8 percent fall in its number of clients to 29 lakh and its market share also reduced 49 bps to 8.8 percent.

Also, 5Paisa Capital reported a 19.6 percent fall in its number of clients to 7 lakh and its market share reduced 42 bps to 2 percent.

Among traditional brokers, both ICICI Securities and IIFL saw a fall in their total number of clients as well as market share.

ICICI Securities reported a 5.7 percent MoM decline in its client count to 23 lakh, with a 23 bps drop in market share to 7.1 percent. Meanwhile, IIFL Securities reported a 13 percent MoM decline in its client count to 5 lakh, with a 17 bps fall in market share to 1.5 percent.