Major French bank BNP Paribas sold South Korean financial group Mirae its domestic retail broking business, Sharekhan, for an undisclosed amount.
Business Standard was emailed by a BNP Paribas representative who confirmed the development but would not provide any information. We have not yet heard back from Mirae Asset Financial Group.
In 2015, a group of investors sold Sharekhan’s 100% equity to BNP, a Paris-based company. Industry insiders estimated the deal’s value to be approximately Rs 2,000 crore, though the exact amount was not revealed.
All necessary regulatory approvals were obtained before the acquisition of BNP was finalized in 2016.
Established in the year 2000, Sharekhan was among the pioneer brokerages providing online trading. With 2.8 million clients, the business offers a variety of financial services. The business says it completes close to a million trades every day.
Prior to acquiring Sharekhan, BNP Paribas acquired a 34% share in Kochi-based Geojit Securities in 2007. The company currently has a market capitalization of Rs 1,650 crore.
With the introduction of COVID, the number of investors in India has more than tripled to over 135 million due to the growth of discount brokers, digital client onboarding, and a long-term increase in stock prices.
Consultant Bain & Company predicts that over the next five years, the topline of the retail broking industry could more than double. During the financial year 2018-19 (FY19), the industry that helps investors trade stocks on the stock market saw its revenues double to Rs 27,000 crore in FY23, representing an annualized growth rate of 17%.
In the 18–30 age range, 70–80% of active clients of discount or digital brokers are young investors, a significant increase brought about by increased financial literacy, easier customer onboarding, and the proliferation of user-friendly digital platforms. Similarly, despite having lower activation rates, 70–75 percent of newly acquired bank broker clients are under 30, according to a note released earlier this month by Bain & Co.
