South Korea's Mirae Asset mulls $150 mn capital infusion in Sharekhan

Foray into wealth management and portfolio management on the cards

South Korea’s financial services major Mirae Asset Capital Markets plans to infuse over $150 million into retail broking arm Sharekhan for expansion into wealth and portfolio management business, said sources.

In December last year, Mirae Asset acquired a 100 per cent stake in Sharekhan from European financial services major BNP Paribas for  Rs 3,000 crore.

In April this year, Mirae Asset received approval from the Competition Commission of India (CCI) and it is now awaiting other regulatory approvals for the acquisition.

“Sharekhan is a profit-making company. As of now in India, Mirae Asset Capital already has around its own capital of Rs 3,700 crore while Sharekhan has Rs 2,000 crore capital. We will be increasing our own capital from South Korea too. Around $150 million investment will take place soon,” said an official seeking anonymity.

Though the timeline for the new investment is yet to be known, sources said that initial approvals have been received from the global parent and will proceed with it soon. The capital will play a key role in the expansion of the recently acquired broking business.

Emailed queries sent to Mirae Asset Capital remained unanswered.

Sharekhan is the second broking platform in Mirae Asset’s kitty. It launched discount brokerage firm m.Stock in 2022.

According to sources, the company plans to focus on diversifying the business of Sharekhan beyond the brokerage business.

Sharekhan will also continue to concentrate on the traditional model for brokerage business while m.Stock, which has a relatively young client base, will focus on digital-led models, they added.

Mirae Asset will not be consolidating both of its broking platforms and will continue to focus on different client bases through each of them.

As of March 2024, Sharekhan stood in eighth place among the discount brokers with over 700,000 active clients. However, its market share declined to 1.6 per cent in FY24 from 2.1 per cent in the previous financial year. The brokerage firms have seen competition getting tougher lately with Groww taking the top spot for active clients with nearly a quarter of the market share.