Leading European Bank BNP Paribas has reportedly divested its domestic retail broking unit, Sharekhan, to South Korea's Mirae Asset Financial Group for Rs 3,000 crore. The deal has been signed, and an official press note is expected soon.
Notably, Sharekhan was among the pioneers in India's online broking segment and has secured its position as one of the top 10 retail brokerage houses in the country. More significantly, the recent sale of Sharekhan by BNP Paribas to Mirae reflects strategic moves within the financial sector and the evolving landscape of retail broking.
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It is understood that BNP Paribas has chosen to exit Sharekhan as part of its strategy not to continue retail business operations in India.
BNP Paribas had announced its acquisition of Sharekhan in 2015, and the deal was completed in January 2018. The acquisition marked a huge move in the financial sector, with BNP Paribas acquiring Sharekhan to gain a strong foothold in India's brokerage and financial services market. The transaction brought in foreign investments of a little over Rs 2,000 crore.
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BNP Paribas has been strategically reshaping its focus by exiting various non-banking businesses. The decision to sell Sharekhan aligns with this strategy, as the French financial services giant aims to concentrate primarily on its banking operations. This move follows earlier exits from mutual fund and wealth management businesses, indicating a deliberate effort by the financial institution to streamline its operations and allocate resources more efficiently.
Before acquiring Sharekhan, BNP Paribas had bought a 34 percent stake in Kochi-based Geojit Securities in 2007. As updated in the Exchanges, in September 2023, BNP Paribas holds 24.67 percent stake in Geojit.
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In the fiscal year ending March 2023, Sharekhan, which had 6.3 lakh active clients, disclosed a net profit of approximately Rs 170.9 crore. This marked a 25 percent decline compared to the net profit of Rs 225.3 crore in the previous fiscal year (FY22).
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