Saturday, April 29, 2006

Online Stock broking on way to becoming billion dollar business

Annual results of India Infoline have left me pleasantly surprised. The earnings reported have tripled from Rs.75 crores in last fiscal 2004-05 to a whopping Rs.218 crores in the current year ending March 31st 2006.

India Infoline’s CFO Ravi Krishnan, in an interview to CNBC-TV18 has stated that 2/3rd of the entire income comes from Brokerage business! This translates to almost Rs.150 crores from brokerage income for the year.

There are only 2 listed online stock broking companies in India, India Infoline & Indiabulls, this makes estimating the market size a little difficult. However, I would estimate India Infoline’s market share at around 7-8% of the total online stock broking business. This translates to a total market size of around Rs.2,000 crores ($450 m). I had in my previous post estimated the last year market size to be around 500 crores. This makes online stock broking business clearly the largest and fastest growing Internet business in India. This business should be crossing billion $ mark in the next 12-18 months.

ICICI Direct, HDFC Securities & Sharekhan are the leaders in this space.

Related links

The details of the press release of India Infoline are available on the NSE website ( under: Corporates > Latest Announcements.