Broking houses in north buoyant again

Broking houses in the Chandigarh region, who lost as much as 50 percent of the business in the third quarter of the last financial year, are now seeing signs of recovery. Some of them have even revived their expansion plans, which they had put on hold.

The region, comprising Punjab, Haryana and Himachal Pradesh, has around 700,000 active demat account holders.

Brokers say serious investors are coming back to the market following the recent stimulus package announced by US President Barack Obama and the fall in interest rate.

It may be mentioned that due to uncertainty in the stock market, most of the investors were shying away from active participation. This not only led to a drastic fall in daily transactions but also compelled regional broking houses to put their expansion plans on hold.

Speaking to Business Standard, Ashish Bangur, country head of Arihant Capital Markets Limited, said business declined by about 50 per cent from October to December last year. However, it has recovered by about 20 per cent from the past three months.

Buoyed by the current trend, the company expects to add more sub-brokers. “We may add 35 more sub-brokers in the north this year from the 45 we currently have,” he said. Last week, it inaugurated its outlet at Panchkula near Chandigarh and is scouting for a suitable partner to set foot in Chandigarh.

Vikson Finance and Investments Pvt Ltd, a regional player with 22 outlets, which had put its expansion plans on hold last year, opened two new outlets recently. “We were encouraged by more enquiries in the past two months and seeking good response we opened two new outlets each at Rajpura and Chandigarh last week,” said director VK Joshi.

Echoing similar sentiments, Bhavmit Tiger Chandoak, CEO and managing director, Tiger Wealth Management (P) Ltd, said, “Earlier, due to uncertainty, the transaction came down drastically but now the situation is improving." He said the company’s expansion plans were back on track. The falling rentals would also help the players to strengthen their network.

According to experts, the stock and equity culture is catching on in the north. In the past few years, brokers of national repute consolidated their presence by opening new branches and regional brokers followed suit.

Further, the presence of a large number of NRIs, commodity traders, landlords, people with high disposable income along with high net worth individuals provide immense opportunity for broking houses here.