Demat tally surges to 185 million in 2024 with 46 million new additions

In the first nine months of 2024, 36 million demat accounts were added, buoyed by gains in the secondary market and record initial public offerings (IPOs)

The number of demateri­alised (demat) accounts in 2024 rose by 46 million, marking an average addition of 3.8 million accounts per month.

 

New demat additions saw a 33 per cent rise from the previous year, taking the total tally to 185.3 million.  

 

The number of demat accounts in India has skyrock­eted since Covid-19, driven by simplified account opening, wides­pread smartphone adop­­tion, and favourable market returns.

 

Demat accounts have more than quadrupled in the last five years from 39.3 million in 2019.

 

The first nine months of 2024 saw 36 million demat accounts added amid gains in the secondary market and record initial public offerings (IPOs). 

 

However, the market turbulence triggered by foreign portfolio investor (FPI) selling and earnings disappoi­ntments led to a decline in the next two months in new account additions.

 

Cumulatively, in October and November, FPIs were net sellers to the tune of Rs 1.2 trillion worth of equities.     

 

The record number of IPOs in December, which was the highest for the year and the best December since 1996, improved the pace of additions marginally.  

 

Last month, 15 companies raised Rs 25,438 crore via IPOs. And in 2024, more than 91 companies have raised Rs 1.59 trillion.

 

A significant number of investors open demat accounts primarily to participate in IPOs. Investors open fresh demat accounts for family members to increase their chances of securing IPO allotments.

 

Demat accounts are used to hold shares and other securities electronically.  

 

Experts view the steady pace of demat additions as a positive sign for market stability.

 

“The incremental flows from these new investors will help offset any potential outflows from overseas funds or existing investors and help keep volatility under check. Going forward, the pace of new additions will hinge on market performance,” said a senior executive of a brokerage requesting not to be named.