MUMBAI: The number of demat accounts in the country crossed the 100-million mark on August 31, 2022, showing the equity culture is slowly but steadily picking up in India, especially in tier 2 and tier 3 cities.
Investor interest in the equity market has seen a rapid rise from 2020 when Covid-19 broke out in the country, with work from home providing first time investors the freedom to dabble in the stock market.
A demat account is an account maintained with a broker for share certificates and other securities that are held in an electronic format.
The total number of demat or investor accounts with the two national depositories— CDSL and NSDL—stood at 100.51 million as on August 31. Total investors accounts with CDSL were 71.16 million and NSDL had 28.9 million.
The last four months of this year saw rapid additions of new demat accounts: August (2.2 million), July (1.8 million), June (1.8 million) and May (2.7 million). The initial public offering of Life Insurance Corporation, which opened on May 4, led to many first time investors opening their demat accounts to participate in the mega IPO.
"Demat accounts surpassing 100 million for the first time shows that the culture in equity investing is slowly but steadily picking up in India, especially in tier 2 and tier 3 cities, which were under-served till now," said B. Gopkumar, MD & CEO, Axis Securities.
Though the figures are impressive, it may be noted that some demat accounts remain inactive. Also, some investors maintain multiple demat accounts with brokers.
“The number of active demat accounts in India as of 31st March 2022 were 89.7 million, showing 63 per cent growth in FY22," said Ajay Menon, CEO– broking & distribution, Motilal Oswal Financial Services.
BSE data shows the number of registered investors as on Sept. 6, stood at over 11.35 crore. The count has risen sharply over the previous year in Assam (119 per cent), Bihar (82.68), MP (77.31), UP (68.64) and Orissa (78.13.)
