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Jul 12, 2010, 01.26 PM IST | Source: Moneycontrol.com

Social networking more popular than Demat a/cs: SMC Cap

SMC Capital is of the view that India as a consumer needs to open up, but India as an investor is yet to be opened.

Social networking more popular than Demat a/cs: SMC Cap

SMC Capital is of the view that India as a consumer needs to open up, but India as an investor is yet to be opened.

In India, the total Demat accounts are about 1.7 crore. And, the total users in social networking sites (Facebook, Orkut, Twitter) are about 3.1 crore. That is, in India, the total users in social networking sites are twice that of the total Demat account holders.

It is incredible considering the fact that the social networking concept got popular only in the last three years. Further, the addition of new Demat accounts in India are about 2 Lacs per month. And, the addition of new mobile connections are about 2 Crores per month. That is, new mobile connections in a month are 100 times that of new Demat account additions.

Further, it also indicates that every month India adds more mobile connections than the total cumulative Demat accounts ever existing. This indicates the low levels of penetration of investing habit in India.

The favorable demographic dynamics were assumed as kingpin of ‘The India growth story’. (That is about 60% of India population being below 30 years age). However, this favorable demographic dynamism is showing up in the habits of social networking sites and new mobile additions. But that is not translating into the growth of Demat accounts and financial sector.

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