LSE Securities business back on track due to revival in stock market

The business of LSE Securities Ltd, a subsidiary of the Ludhiana Stock Exchange is back on track due to a surge in stock indices . At present, it is doing a daily turnover of Rs 500-600 crore against Rs 150 crore per day in 2008, as there was an uncertainty in the market then. Buoyed by the response from investors, it is also planning to introduce mutual fund trading and currency futures in euro and yen.

Speaking to Business Standard, LSE Securities Ltd (LSESL) CEO, Rajesh K Sharma said, “This year, it has been pretty good for LSESL. Our trading volume has increased leaps and bounds in the current financial year as compared to last year when there was uncertainty in the stock market. At present we are doing a daily turnover of Rs 500-600 crore. So far the average turnover is concerned, we are hopeful that this financial year our average turnover would be Rs 550 crore per day.” This includes the trading volumes of the capital market segment of the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) and the futures and options (derivatives) segment of the NSE. With the surge in indices, the sub brokers’ business of LSESL is also getting back on track since March, 2009.

It is worth mentioning that last year, the uncertainty in the stock market gave a big jolt to LSE Securities Ltd, which caters to the investors of Punjab, Himachal Pradesh, the Union Territory of Chandigarh, and Jammu & Kashmir. Ludhiana Stock Exchange, through its subsidiary LSE Securities Ltd, which used to do a turnover of Rs 500 crore a day till March, 2008, was severely affected by the turmoil in the stock market as the trading volume had been reduced to Rs 150 crore (approx) per day. Also, the trading volumes of the sub-brokers have been severely affected due to low transaction.

However, the surge in stock market this year has also led to increase in number of investors. At present, LSE Securities Ltd has 45,000 Dps (Depository Participants) account holders and the management thinks it would further increase in the coming months.

Commenting upon expansion plan, company chairman Anurag Arora said, “We are going to upgrade our total trading platform, including upgrading software, facilities and are also planning to impart technical training to members. Besides that we are also planning to start Mutual Fund trading in few days.” Already it has started trading in currency futures and planning to introduce currency features in Euro and Yen by March 2010.

To increase its presence in the region further, it has plans to open its branches of depository services in the major cities of the region. To start with, it has already opened its branches at Jalandhar Amritsar and Chandigarh.

Besides this, the exchanges plan to join Delhi Stock Exchange, Kanpur Stock Exchange and Jaipur Stock Exchange through tie-ups. That is likely to help about 4,000 companies listed in these local exchanges to increase their net worth, whose capital is blocked at the moment and will also benefit their shareholders. At present about 3,200 companies are listed in Delhi Stock Exchange, 300 companies each in Ludhiana and Kanpur exchanges and rest in Jaipur stock exchange.