Synopsis
The Economic Survey 2024-25 reports a significant increase in investor numbers in India's capital markets, rising from 4.9 crore to 13.2 crore over four years, driven by strong fundamentals and regulatory measures.Key Takeaways
- Investor numbers rose from 4.9 crore to 13.2 crore.
- Resource mobilisation from primary markets reached Rs 11.1 lakh crore.
- India's share in global IPOs increased to 30%.
- BSE market capitalisation to GDP ratio at 136%.
- Insurance sector projected to be fastest-growing among G20 nations.
New Delhi, Jan 31 (NationPress) India's capital markets have showcased impressive growth, enhancing capital formation in the real economy, boosting the financialisation of domestic savings, and facilitating wealth accumulation, as highlighted in the Economic Survey 2024-25.
The number of investors has surged from 4.9 crore in FY20 to 13.2 crore by December 31, 2024. This remarkable expansion, paired with energetic listing activities and the recent initiatives by the Securities and Exchange Board of India (SEBI) to regulate excesses, is anticipated to promote sustainable market growth, as per the survey.
The continued growth of the market is driven by strong macroeconomic fundamentals, healthy corporate profits, supportive institutional investment, robust SIP inflows, and a rise in formalisation, digitisation, and accessibility.
The survey notes that the primary markets have experienced increased listing activities and investor enthusiasm in FY25, despite market volatility and geopolitical uncertainties.
Resource mobilised from primary markets (equity and debt) reached Rs 11.1 lakh crore from April to December 2024, marking a 5% increase compared to the total for FY24. India’s share in global IPO listings surged to 30% in 2024, significantly up from 17% in 2023, establishing it as the leading contributor to primary resource mobilisation worldwide.
The BSE market capitalisation to GDP ratio was recorded at 136% at the end of December 2024, reflecting a substantial increase over the past decade. The robust performance of the Indian stock market is attributed to strong profitability growth, rapid development of digital financial infrastructure, an expanding investor base, and significant reforms in products and processes.
The survey also emphasizes the positive trajectory of India's insurance sector, which is expected to become the fastest-growing market among G20 nations within the next five years (2024-2028). Insurance premiums grew by 7.7% in FY-24, reaching Rs 11.2 lakh crore.
With an overall insurance penetration rate of 3.7%, below the global average of 7%, there exists a significant coverage gap, presenting opportunities for insurers to enhance their reach. By focusing on tier 2 and 3 cities and rural areas where awareness and accessibility are limited, insurers can tap into new customer segments and drive growth.
Moreover, the survey indicates that India's pension sector has expanded considerably since the launch of the National Pension System (NPS) and Atal Pension Yojana (APY). As of September 2024, the total subscriber count reached 783.4 lakh, reflecting a year-on-year growth of 16% from 675.2 lakh in September 2023.
