India’s market capitalization surges 11% CAGR to $3.5 tn over last decade

GDP grew at 6.4% over the past decade, making India one of the world's fastest-growing large economies

July 7, 2023

Retail, HNI participation are now 69% of NSE’s cash market turnover as compared to 58% in FY16

A recent report by JM Financial Institutional Securities said that India’s market capitalization grew at 11 percent over CY12-CYTD23, much faster than GDP, facilitated by the financialization of savings, new tech enablers (fintech/ discount brokers) and improved c (SIP culture, demat a/cs at a record 115mn)

India is now a $US 3 tn plus economy. GDP grew at 6.4 percent over the past decade, making India one of the world’s fastest-growing large economies, and it is poised to grow by 6 percent over the next five years.

Retail and HNI participation is now 69 percent of NSE’s cash market turnover as compared to 58 percent in FY16. The total market cap of companies in India stands at $ 3.5tn (as on June 30, 2023), with indicators such as Mcap/ GDP ratio (India at 93 percent vs 183 percent of US) and turnover to Mcap (India at 50 percent vs US at 148 percent) pointing towards a long growth runway.

Capital market penetration will continue to rise, aided by structural tailwinds such as a strong GDP growth (pegged at 6 percent in the next few years), financialization of savings with equity investing picking up, currently 8 percent of savings, discount brokers driving higher retail participation, and increased market depth via regulatory push (slashing promoter holding), the report said.

[With Inputs from IANS]

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