The surge in the stock market has prompted retail investors in Punjab to take advantage of the positive sentiments.
According to brokers, even small cities, especially tier-II and tier-III cities, are bustling with activity, as potential investors are making beeline to open demat accounts to participate in the rally. They said the surge in the Nifty and the Sensex index has caught the fancy of investors.
Data from NSDL revealed that Ludhiana has the largest number of demat account holders (44,184), followed by Amritsar (40,970) and Jalandhar (31,112) till August 31, 2010. Overall, Punjab had 194,554 demat account holders in the state, as compared to 168,744 it had as on August 31, 2008.
If we compare NSDL data, (till August 31, 2008), Ludhiana was the front runner followed by Amritsar. Last year, there were 38,086 demat account holders in Ludhiana, while Amritsar had 36,021 account holders and Jalandhar 29,141.
The report said small cities like Hoshiarpur, Gurdaspur, Sangrur and Rupnagar, among others, are attracting potential equity investors. The data suggests a significant growth in demat account holders in these cities.
As on August 31, 2010, Hoshirapur had 11,720 demat account holders, Gurdaspur (11,513), Sangrur(7,876) and Rupnagar (4,323). Industry insiders believe lack of job opportunities along with the recent property boom, has led to a substantial increase in the number of investors in small cities.
Gurmeet Chawla, director of Ludhiana-based Master Trust Ltd – a broking house – told Business Standard: “Due to uncertainty in the stock market in 2008, the investors were shying away from the market. But now the situation has changed and serious investors are back in the equity market including first-time investors.”
“The increase is because of higher awareness among people and the boom in the stock market. This is evident from the fact that there are many national brokers along with regional brokers, operating from herem,” said another official of a broking firm.
Regional brokers, like Vikson Finance & Investment Private Limited, opened their terminals in small towns like Rajpura, Barnala, Nangal, Ropar and Nabha.
