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The next big disruption? Brokerages bet big on advisory services

While there is a surfeit of brokerages in the country, there is still room for disruption in the advisory space, which appears to be underserved. And both new-age and traditional brokerages are eyeing the niche.

April 28, 2021 / 12:56 PM IST

Abhimanyu Bisht, 36, who works with a venture capital firm, manages his own stock market investments. He researches the segments he’s looking at thoroughly and picks stocks he thinks will do well. On occasion, though, he would have liked to be saved a bit of that effort with some reliable advice. “Advisory is heavily missing. While many investors can decide on their own there are many who need some kind of help or guidance. There could be some innovative models around this (by brokerages),” says Bisht.

The last few years have brought about a paradigm shift in the manner investors trade in the stock market and the stock broking industry has been the most impacted. Gone are the days when investors would call their dealers or relationship managers to trade in the stock market. Now, most retail investors just open an app on their smartphones and start trading, be it in stocks or derivatives.

This trend has also brought along with it a huge disruption in the stock broking segment, with most new-age technology savvy players now making the maximum number of new-client additions and the traditional ones witnessing a slowdown in the pureplay broking business.

It comes as no surprise that the current list of the biggest brokerages in India, in terms of the number of client accounts, features young and tech-savvy broking entities such as Zerodha, Upstox, 5Paisa and Groww.