The Hindu Business Line : NSDL clocks rise in investor accounts

THE slowdown seen in the equity market in October has not really dampened investor sentiment, as figures clocked by the depositories indicate. The number of investor accounts with National Securities Depository Ltd (NSDL), the leading player, has actually risen in recent weeks, keeping the general trend intact.

The increase is said to be in contrast to the significant decline in the indices last month, which had stemmed from extensive selling by most categories of investors, large and small.

The rise, which sources say is an indicator of the overall bullishness, has reflected the fact that more accounts are being opened despite what appeared to be a weakening situation.

The rise, in fact, is also being viewed as a continuation of the trend that had set in earlier, triggered as it was by an advancing stock market.

The latter has been moving up steadily, the change being most evident in the past two years or so.

As for exact figures, NSDL has pegged it at 71,19,548 (as on November 5). Incidentally, the number of accounts with debt instruments stood at 1,28,510 on that date. There were 219 depository participants (compared to 286 with Central Depository Services (India) Ltd), while there were 2,912 DP service centres in existence.

The state of affairs is a fallout of the arrival of small investors in very large numbers, it is said.

The number of retail participants in the market has actually jumped, thanks to the interest shown by small shareholders. The latter, however, is generally considered to be fickle - a group that may well move away from the stock market once sentiment starts waning.

The depositories also attribute the development to the rise in the need to demat share certificates. Investors are now more aware of the benefits that can arise out of operating in a paperless environment, according to marketmen.

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