The holding value of shares held by retail investors fell ₹1.67 lakh crore during the three-month period ended June to ₹17.58 lakh crore, a report by Business Standard informed quoting data from PRIME Database.
As per the report, retail shareholders — individuals who own shares of less than ₹2 lakh in a company — increased their shareholding in 975 companies and reduced it in 730 companies. Their average holding declined marginally to 7.4 percent as on June 30, from 7.42 as on March 31, it added.
Meanwhile, the shareholding of high networth individuals (HNIs) — those holding shares worth more than ₹2 lakh in a company — also declined to 2.08 percent as on June 30, from 2.21 percent on March 31, the report pointed out.
The erosion of individual investor wealth comes on the back of a 10 percent drop in the benchmark Nifty during the quarter ended June — its worst quarterly performance since March 2020, BS explained.
The fall in individual investor holding also impacted their activity, with trading volumes in the equity cash segment dropping to their lowest levels since March 2020. Also, there was moderation in new Demat accounts opened during the quarter, noted the report.
Further, the report informed that even though the individual investor flows into equity markets via direct investing declined, their investments through mutual funds (MFs) continue to be strong. The share of domestic MFs rose for the fourth straight quarter to reach a two-year high of 7.95 percent as on June 30, up from 7.75 percent as on March 31, it said.
The report also highlighted that the companies where retail investors increased their stake fell an average of 10.4 percent during the quarter, while those that saw an increase in retail holding fell just about a percent. Meanwhile, stocks where HNIs pared their stake fell nearly 7 percent during the quarter, while companies that saw a decrease in holding fell an average of 6.2 percent, it added.