The total number of active users at the National Stock Exchange (NSE) grew by 2.7 per cent year-on-year (y-o-y), but fell 2.9 per cent on a monthly basis to 34 million in January 2023, according to a report by Motilal Oswal Financial Services.
This was the seventh consecutive month of a decline, the report said.
According to the report, the intensity of the fall was higher in January 2023 (at 1.04 million accounts) against 0.7 million in the past three months.
“The number of active users on NSE saw a further drop to 34.3 million from 35.3 million in December 2022 – the seventh consecutive month of a decline,” the report said.
At present, the top five discount brokers account for 59.2 per cent of the overall NSE active clients, and it was slightly down from 59.3 per cent in December 2022, the report said.
Incremental demat account additions improve, but still below FY22 average
The report said there was a slight increase in the number of number of demat accounts in January 2023. The incremental account additions stood at 2.2 million in January 2023 as against 2.1 million in December 2022.
Although the additions were higher than the past four months, the number continued to be below the FY22 average run-rate of 2.9 million.
“Demat account additions stood at 2.2 million. Although it has been trending higher sequentially for the past two months, it continues to be lower than the average of 2.9 million for FY 2022,” the report said.
The Central Depository Services Ltd (CDSL) retained its overall market share at 72 per cent. With respect to incremental demat account additions, the National Securities Depository Limited (NSDL) market share declined to 18.5 per cent in January 2023 from 21.3 per cent in December 2022, the report said.
According to the report, capital market sentiment of India Inc. was negative in January 2023, with the Nifty declining by 2.9 per cent on an month-on-month (m-o-m) basis.
That said, the volatility increased toward the end of the month, in anticipation of the Budget announcement, the report said.
“This translated into strong traction in volumes on the bourses with overall average daily turnover (ADTO) jumping 6.4 per cent m-o-m to Rs. 203 trillion. Overall, retail ADTO stood at Rs 77 trillion, up 2.7 per cent m-o-m,” the report said.
“Overall, ADTO surged 124 per cent y-o-y and 6.4 per cent m-o-m to Rs 203 trillion, aided by a 6.5 per cent m-o-m jump in F&O ADTO to Rs. 202 trillion. Cash ADTO dipped 9 per cent m-o-m and 25 per cent y-o-y to Rs. 518 billion. Within the retail segment, cash ADTO declined 20 per cent m-o-m to Rs. 229 billion, while F&O ADTO jumped 3 per cent to Rs. 77 trillion,” the report said.