JOIN US The government’s reform agenda is leading to more inflow of capital into India, even as it improves the overall market environment. Hence, retail participation is increasing in the equity market, according to HDFC Securities MD and CEO Dhiraj Relli.
HDFC Securities, a subsidiary of HDFC Bank, is one of India’s premier broking houses for retail and institutional participants. The CEO says even though equity is a riskier asset class, there are hardly any returns available to customers elsewhere. “So if you really want some real returns, you will have to take the risk and invest in equities,” he said.
He added, “In the last ten years, the market has given about 14-15 per cent kind of returns on an average. But the last year was exceptional when the equity market delivered about 28-30 per cent returns.”
Relli believes now is the right time for someone to participate in the stock market. Even though earnings in the last quarter were disappointing, he said earnings should start showing an uptrend from the third quarter. He stressed that stability in oil prices will lower the cost of borrowings, directly improving bottom lines. “When earnings improve, it gets reflected in the share pricing,” he said.
Retailers miss the bus
According to Relli, retail investors are always the last to enter the market. They wait for the market to go up or enter during the peak of the market. “My suggestion to retail investors is to invest in the equity market using the DIYSIP route, and not to enter when the market is already at its peak. Currently, valuations are up and it is a good time to invest in the markets.”
He said HDFC Securities has launched the first-of-its-kind application available in 12 languages. The multilingual application is available on the Android platform. But other applications are available for iOS and Blackberry as well, he said. According to Relli, trading over mobile has tripled in the last one year. “Right now, 10-12 per cent of our trade comes from the mobile application. We see participants from smaller towns from Karnataka. With the launch of the multilingual app, we expect mobile trading volumes to double every year, at least for the next three years,” he said.
“In Karnataka, we currently have 12 branches; five in Bengaluru and seven in district headquarters — Ballari, Mangaluru, Mysuru, Hubballi, Gulbarga, Davangere, and Belagavi. We are looking to add at least five to seven branches in Bengaluru and will look for opportunities in upcountry markets as well,” the CEO added.
He said HDFC Securities currently has 250 branches present in 185 cities and is looking forward to add 50 more branches.