bl interview. ‘Retail investors are now moving from quick money to sustainable investing’: Pranay Aggarwal, CEO, Stoxkart

PSU, defence, and metals are sectors seeing renewed optimism. Is this a long-term conviction or a short-term narrative play?

So PSU was our darling of the past two years. Everyone earned very well there—we saw stocks like Cochin Shipyard and all the railway stocks doing very well. But going forward, I think defence is somewhere we see a lot of retail interest now. Because India is bound to rely on their own defence companies rather than importing foreign defence products. It is the need of the hour to have our own indigenous defence lines and not to be dependent. So this is one sector we see a lot of interest in.

Are you seeing a shift in portfolio strategies among retail investors recently?

Yes, there is a shift. If you see the PEs of big companies like Reliance and all the big blue-chip companies, they are somewhere in the normal range. Not as high as it was last year or maybe when markets were at an all-time high. So we see people moving towards blue-chip stocks rather than small-cap and mid-cap, which was the trend in the last five years. Now is the time for portfolio correction.

How are you viewing mid- and small-cap stocks in the current scenario?

Mid-cap and small-cap will do good, but when you can have stocks like blue-chip stocks at the same PE level as a mid-cap stock, it always makes sense to have your money in those blue-chip stocks. I see Nifty recovering more than mid-cap and small-cap.

What are some of the trading and investing patterns emerging among Gen Z and first-time market entrants?

In the last few years, many Gen Zs and younger people came into the market with little to no knowledge. They wanted to earn quick money. Many got into option trading and burned their hands. Initially, they made money, so when you draw first blood, you think you can’t lose in the market. But when the portfolio correction started in the last one year, many of them moved towards experts and SIPs. Now they know that some years will be good and some will be bad.

Do you think digital broking platforms have gamified trading to some extent? Where’s the line between accessibility and risk-taking?

Digital broking and discount broking, like ourselves, have really lowered the barrier of entering the market. It is very easy to open a Demat account and start trading—it’s almost like downloading an app and playing a game. But the markets are real and the money is real. Brokers like us can provide education on the same platform so users are more empowered. Apart from education, we also connect users with SEBI-registered experts and provide their research on our platform.

Are there differences in behaviour between metro users and those from Tier-2 and Tier-3 cities?

Around 65 per cent of our new accounts are being acquired in Tier-2 and Tier-3 cities. This is very encouraging. India is growing and people in these cities are starting to save and invest. Investment patterns are more or less the same, but there’s a lot of wealth being unlocked in those cities. As for trading preferences, F&O is very fascinating to youth across cities because it shows the dream of quick earning. But without capital and knowledge, people shouldn’t get into it. SEBI has increased lot sizes to prevent such entry-level risk-taking.

You mentioned research tools. How are users engaging with tools like AutoTrender?

AutoTrender is what we call a decision-support system. It looks at 20+ indicators to predict market trends, using open interest data and put-call ratio strategy. Any serious option trader benefits from it. This data is available on NSE as well, but AutoTrender presents it in a simpler format. We see a lot of interest from actual traders in the market for such software.

Can you walk us through the business model Stoxkart is currently operating with? How is it different from the conventional broking structure?

What we are doing is allowing investors to trade unlimited at a subscription amount. Currently, how brokerages work is they ask people to pay a certain amount per order. What we do is we charge ₹99 per month and allow unlimited trading to users. Suppose someone buys at ₹500 and sells at ₹505—in traditional brokerage, they pay ₹20 to buy and ₹20 to sell, so ₹40 goes in brokerage. They think they’ve made ₹5 profit but actually end up in loss. But in our case, since we charge ₹99 per month, traders can sell even at a ₹1 or ₹2 difference and still make a profit. This helps those who trade frequently and on low margins. We launched this plan on May 1 and have around 1,500 users currently, mostly close users. Our aim is to reach one million customers by year-end.

Do first-time users have a good grasp of basic financial concepts like P/E ratios, interest cycles, and SIPs? How important is financial literacy today?

Financial literacy is very important. As stock brokers, we have a responsibility to educate customers. All these topics should be taught through the broker— we put a lot of free content out on social media platforms. I feel this should even be part of college curriculums. YouTube is the biggest platform available to everyone, but users must know which channels to follow. Education is accessible—you just need to grab it.