Trading cooled even as fund mobilisation surged in India’s markets in 2025

Trading cooled even as fund mobilisation surged in India’s markets in 2025

• NSE cash market turnover fell 14.5 percent in 2025 despite index gains
• Equity derivatives turnover fell 24.6% as retail participation declined significantly.
• Record capital raised via IPOs and equity issuances as trading activity cooled

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India’s secondary market activity cooled meaningfully in calendar year 2025 even as capital raising through the primary market hit record levels, pointing to a growing divergence between trading participation and fund mobilisation, according to the National Stock Exchange’s annual highlights.

Cash market turnover on the NSE fell 14.5% year-on-year during 2025, reflecting a slowdown in equity trading despite benchmark indices ending the year with gains. The moderation was sharper in the derivatives segment, where equity derivatives turnover declined 24.6% over the year, marking a clear pullback in trading intensity across key market segments.

The slowdown was accompanied by a fall in participation, particularly among retail investors. The number of individual investors who traded at least once in the cash segment declined 8% during the year. In equity derivatives, the drop was steeper, with retail participation falling 25.5%, underscoring a broad-based retreat from high-frequency and leveraged trading activity even as market levels remained elevated.

In contrast, fund mobilisation through the primary market remained robust. Companies raised a record amount of capital through IPOs and other equity issuances during 2025, making it one of the strongest years for fundraising on Indian exchanges. Mutual funds played an increasingly prominent role in primary market activity, deploying significant capital into public issues and emerging as key anchors in large offerings.

The combined data points to a year in which investor engagement shifted rather than disappeared. While capital formation through equity issuances stayed strong, day-to-day participation in cash and derivatives trading weakened. The divergence suggests that investors were willing to commit capital at the point of issuance but were more restrained in secondary market trading, particularly in derivatives.

The NSE data highlights how 2025 unfolded as a year of contrasting trends within domestic markets, with strong fund mobilisation running alongside a visible cooling in trading volumes and participant activity.