The country’s broking industry is in a “healthy pause” phase, a period of recalibration after the post-pandemic boom. Captains of the broking and wealth management industry believe market nervousness and tighter regulation in the derivatives segment have contributed to the slowdown, which is both expected and necessary.
Speaking at the Business Standard BFSI Insight Summit 2025 in Mumbai, Shripal Shah, MD & CEO, Kotak Securities; Pranav Haridasan, MD & CEO, Axis Securities; Amisha Vora, chairperson and MD, PL Capital Group; and Ajay Menon, MD & CEO – Retail Wealth, Motilal Oswal Financial Services, shared their insights on how the industry is evolving amid regulatory changes, rising compliance costs and an increasingly informed investor base.
Cooling-off after record growth
Following an unprecedented surge during and after the pandemic, the broking industry has seen trading volumes and account openings moderate over the past year. “This pause is going to turn into a reboot mode,” said Shripal Shah of Kotak Securities.
While derivative orders have dropped about 30 per cent from last year, he said the reset will prepare the industry for deeper market participation. “About 63 per cent of Indian households are aware of the capital market, but only 9.5 per cent participate. The next phase of growth lies in bridging that gap,” Shah said.
Long road to market penetration
As India’s equity participation continues to trail global peers, Pranav Haridasan of Axis Securities points out that market maturity evolves alongside rising income levels. “In the US, 55–60 per cent of people invest in equities, while China is around 18–20 per cent. India will see participation rise as per capita GDP improves,” he said.
He also cautioned that the journey ahead will be gradual. “Unlike the Covid-era spurt, this will be a secular, steady journey,” he said. The industry is now focusing on sustainable account growth and the right customer targeting, enabled by data and technology.
Haridasan emphasised that awareness alone isn’t enough and education must accompany access. “There is a real need in financial services to teach the basics of investing really well,” Haridasan added.
Compliance, cost and youth factor
Rising compliance and cybersecurity spending continue to shape the industry’s cost structure. Compliance costs have gone up by the day, from cyber safeguards to account opening norms. But this discipline will strengthen the ecosystem, opines Amisha Vora of PL Capital Group.
Vora also noted how new investors are reshaping market dynamics. “Over 50 per cent of new accounts in the industry were opened in North and East India. less than 50 per cent of new accounts were opened in the western and southern regions, which are considered more financially literate,” she said.
And, the young demographic will be central to long-term market growth in India. “More than half of new investors are below 30 years of age, their continued participation, directly or through mutual funds, is a structural positive,” she said.
From short-term gains to long-term vision
While digital access has democratised investing, the challenge lies in converting new traders into disciplined, long-term investors. Ajay Menon of Motilal Oswal Financial Services pointed out that retail investors are maturing fast. “Investors are smart. They know that consistently putting money into the market will give them long-term growth in their overall investment journey,” he said.
Diversification remains key to wealth creation, with a focus on spreading investments across mutual fund SIPs, insurance, and alternate assets to strengthen clients’ long-term wealth journeys, Menon said.
He also underscored the importance of systematic investing, “From a retail investor’s perspective, there needs to be some amount of investment into mutual fund SIPs, since it gives you a sustained growth journey.”
Digital push for the sector
While discount brokers have transformed the landscape, full-service players are keeping pace through digital innovation and advisory depth. “Today, a full-service broker can offer a digital platform as advanced as any discount player, with the added advantage of research and education,” said Shripal Shah of Kotak Securities.
He added that industry consolidation will be driven less by regulation and more by the need for technology investment and resilience, Shah said. The panellists at the BS BFSI Insight Summit agreed that as AI-driven advisory, financial education and responsible leverage take root, India’s broking industry will emerge stronger.
Consolidation and the road ahead
Looking ahead, the industry leaders agreed that consolidation is inevitable as compliance, technology and cybersecurity requirements demand scale. “Smaller players may merge or exit, but innovation will continue,” Shah said. “There’s still a lot of potential in AI-led advisory and automation.”
Haridasan emphasised that the industry’s fundamentals remain strong. The broking industry has taken a pause, but it’s rebooting. With AI, data analytics and rising financial literacy, the next phase will be more efficient, inclusive and resilient, he shared.
