• The total number of clients holding a demat portfolio with us crossed 1 million last month.
• Our market share in the broking business rose by 4% in futures & options and by 12% in commodities month on month in March this year.
• New client additions grew by 5% month on month in the same period.
• The count of trailing 12-month active clients reached 679.3K in March 2021 from the previous month’s close of 676.6K.
• About 12.14K branch-mapped clients and 4.8K franchisee-mapped clients were reactivated as part of the Front Foot Programme in the last month.
• Our mutual fund assets under management crossed Rs.4,800 crore last month.
• Last month, Sharekhan became the second largest national distributor of mutual funds, contributing Rs.11.94 crore to the SBI International Access - US Equity FoF NFO.
• EMF funding stood at an all-time high of Rs.418 crore in March.
• Loan Against Securities book grew fatter by 21% on account of disbursements of Rs.215 crore in the last month.

I do hope you and your family are safe in these extremely trying times. The COVID-19 pandemic situation has evolved over the past few weeks and our country is now reeling under the second wave of the Coronavirus, with the daily count of positive cases growing rapidly. A few states including Maharashtra, Uttar Pradesh, Delhi and Rajasthan account for the majority of the new cases reported in a day. Among them, Maharashtra, the home state of Sharekhan, is the worst affected and accounts for over 60% of the active cases in the country. The number of COVID-19 positive cases among Sherus is also on the rise and I would like to offer my support and solidarity to all Sherus who are affected by the virus.

Through our various business lines we are providing essential services and our clients depend on us for growing their savings. I am humbled to see that Sherus across the country are making tremendous efforts to ensure that all customer needs are met in spite of the pandemic. My heartfelt thanks to all staff of Sharekhan for setting an extraordinary example of hard work, commitment, collaboration and professional behaviour in these challenging times.

In broking, we achieved a unique milestone last month when the total number of clients holding a portfolio with us crossed 1 million. In the same month, we recorded a 5% month-on-month (M-o-M) growth in new client additions while our market share in the futures & options and commodity segments grew by 4% and 12% month on month (MoM) respectively. However, our daily average revenue fell by 12% MoM last month mostly due to a decrease in the market turnover in the cash and commodity segments, a 2% M-o-M dip in the market share in the cash segment and lower customer pricing due to lower retail participation.

Compared with the other asset classes, equities are known to provide higher returns over the long term. Market corrections present good opportunities to invest in fundamentally sound companies recommended by our Research team. We should ensure that our clients make the most of these investing opportunities to achieve their financial goals. We should also create awareness about the benefits of equity investment among the public, facilitate the entry of more and more people into the stock market, and use our skills and experience to help them.

The Front Foot Programme (FFP) had another fruitful month. The trend of seeing new highs for the trailing 12-month (TTM) active client count continued in March, though at a slower pace, as it touched 679.3K. The count was just around 3K more than the count of February 2021. That’s partly because in March 2020 there was a large public issue and the market was also at relatively lower levels which had caused many clients to transact during the month but some of whom did not trade later. FFP facilitated the reactivation of almost 12.14K branch-mapped clients during the last month. What’s more, the efforts of the franchisee network resulted in the reactivation of another 4.8K clients in the same period.

Reactivations are also good for revenue. Close to 4.1% of the clients who got reactivated in March also traded in futures & options and a large proportion of the reactivated clients have continued to be active beyond just one or two transactions. Almost 42% of the clients reactivated in the last month have conducted three or more transactions already. A few big milestones are on our goal list for the next couple of months. My best wishes to the entire front-line team as well as our Business Partners for continued success. Keep up the good work.

Our mutual fund assets under management (AUM) crossed Rs.4,800 crore in March on the back of a strong growth in Systematic Investment Plan (SIP) inflows. The monthly SIP flows touched a high of Rs.48 crore last month after a gap of 2.5 years. Equity flows also turned net positive during the same period. On an overall basis, we continued to witness outflows, though the pace of redemptions slowed down significantly. During the last month, we were the second largest national distributor of mutual funds, contributing Rs.11.94 crore to the SBI International Access - US Equity FoF NFO, which collected Rs.540 crore in all.

The AUM of our Exchange Margin Funding (EMF) business remained flat MoM at Rs.403 crore in March 2021 but the EMF funding hit an all-time high in March at Rs.418 crore. On a year-on-year basis, the EMF book showed a growth of about 290% at March-end due to the lower base of Rs.103 crore on account of a market correction in March 2020. We are aiming for AUM of Rs.500 crore this year and I am confident we will achieve the target. All the best to the front-line and EMF teams.

Our business has recently been recategorised under “Essential Service” by the Maharashtra state government. Consequently, we have been allowed to operate on only weekdays from 7am to 8pm during the period of the mini lockdown declared in the state to control the spread of the pandemic. At this hour, the health and safety of our staff remain our top priority. We are following every advice of the government and public health authorities at all our establishments that are open across the country. We are also taking proactive measures to protect the staff who need to work from office locations to provide uninterrupted service to our customers. Please note only very critical staff are being allowed to work from office locations (please refer to the advisory released by our CHRO Rajesh Shetty earlier today), the rest of us have to hold the fort from our homes.

I don’t have words to express my gratitude to all those colleagues who are coming to office for work to maintain business continuity. I once again thank all Sherus for showing continued perseverance and courage in the face of the crisis — I am proud of you all. The times remain difficult and the second wave of the pandemic has hit us harder. Please continue to follow all COVID-19 protocols whether you work from office or home: Maintain social distancing; wear a mask; wash your hands frequently; keep rooms well-ventilated; and cough away from others into your elbow to stay safe. Take care of yourself and your loved ones. We will overcome this challenge together.

Thank you.

Best regards,
Jaideep Arora