Global Capital Markets Stock Markets in India Comparative Study of Stock Exchanges Preface |Foreword |Executive Summary | Methodology | Industry Report| Financial Analysis| Interview Section|Award Winners| Company Listing| Sponsors| Launch Event| D&B Editorial Team Alphabetical Listing Total Terminals Sub Brokers Total Employees Offices Offerings Cities Waiting in the Wings Angel Broking Limited Bombay Stock Exchange Limited Kotak Securities Limited Motilal Oswal Securities Limited Reliance Securities Limited

Dun & Bradstreet India (D&B India) is pleased to bring you ‘India’s Leading Equity Broking Houses 2009’ - the third edition of the series India’s Leading Equity Broking Houses. The publication was conceptualised to be a key source of information about India’s equity broking industry and felicitates the leading players of the broking industry. It profiles major broking houses engaged in the equities market; and also analyses the important trends and developments in the equity broking industry. The publication profiles 209 equity broking firms which collectively accounted for 134,724 terminals. The top 10 firms accounted for almost 50% of the total terminals. The publication gives a brief overview of the Indian equity markets, a comparative study of the leading stock exchanges and also presents the diversity of derivative trends in global and the Indian markets.

This edition of the publication has a significant addition by incorporating financial analysis section which contains an analysis of 39 companies on a comparative basis for FY08 and FY07. The section analyses the performance of the 39 equity broking houses related to total income, total expenditure, profitability margins, product diversification and other related operational aspects of large, medium and mid-sized firms. Some of the key findings include

• The broking houses in the study reported miniscule growth in net profit margins over the last two years. The net profit margin for FY08 stood at 21.6%, almost in line with FY07’s 21%. However, mid-sized broking houses showed some improvement in margins with 15.2% in FY08, while the corresponding figure for the previous year stood at 11.6%.
• Equity broking firms of all sizes are gradually moving towards a diversified product mix that include wealth management, portfolio management services (PMS) and advisory fees etc.
• Medium-sized firms grew faster than their peers in terms of total income but heavy reliance on core broking activities for revenue generation makes them more vulnerable in difficult times.
• Employee cost was the single largest cost component for the equity broking sector at 25% – although there was a decrease over the previous year. For small firms however, 38% of total expenditure was employee costs.

To get a better perspective of recent trends, the above study also includes an analysis of 17 listed companies whose results were available for the nine months Apr – Dec 2008. For the first nine months of FY09, the total income for the 17 listed equity-broking companies decreased by 18.4% as compared with the corresponding period last year. For the same duration, the profits were halved and the net profit margin stood at 16.7% as compared to 29.1%.

With the domestic economy gradually expected to get back on track, it seems that new opportunities will continue to unfold for the Indian equity broking industry in the form of new financial products, heightened per capita income and increasing investor interest in the near future. D&B India is confident that ‘India’s Leading Equity Broking Houses 2009’ will provide the right platform to enable the industry to prepare for the upcoming opportunities. We will continue to track the development of this sector and enhance this publication as an authoritative reference guide.

Kaushal Sampat
Chief Operating Officer
Dun & Bradstreet India