By Aayush Khanna
Retail investors are increasingly showing confidence in the National Stock Exchange (NSE), with retail holdings surging almost five-fold to 8.75% as of September 2023, compared to 1.85% in September 2020. The number of retail shareholders has also skyrocketed from less than 400 to an impressive 7,303 during the same period.
Quarterly, an average of 500 shareholders have been added, with the most significant addition occurring in the latest quarter, welcoming 1,666 new investors. The shares held by retail investors have risen from 91.5 lakh in September 2020 to the current tally of 4.33 crore.
The NSE stock has gained substantial activity, ranking among the top five most actively traded stocks in value terms from December 2022 to March 2023. Market participants attribute this to the NSE’s share price rally, which has quadrupled over the last three years, reaching approximately INR 3,200 per share in the grey market. At this price, the stock is valued at around 21 times its FY23 earnings, notably lower than its listed peers BSE and MCX, which command PE ratios of 46x and 326x, respectively, based on their TTM earnings.
In terms of financial performance, NSE’s net profit increased by 11% in the first half of FY24 to INR 3,843 crore, driven by a 19% growth in net revenue. The stock exchange achieved a net revenue of INR 6,639 crore for the first six months of fiscal 2024. Over FY20-FY23, NSE’s net profit and revenue surged at impressive compound annual growth rates (CAGR) of 57% and 50%, respectively.
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