One and a half year in the name of capital market : Tyagi

Mumbai, 17 September. Securities and Exchange Board of India (SEBI) Chairman Ajay Tyagi today said that the last one-and-a-half years has been in the name of capital markets for being a reliable platform for investors to invest and companies to raise capital. Speaking at the 12th Finance Markets Conference of the Confederation of Indian Industry (CII), Shri Tyagi said that the last one and a half years has been in the name of the capital market due to being a reliable platform for investors to invest and companies to raise capital. He said that after the markets touched new highs in January 2020, the market indices started falling in March as soon as the corona epidemic spread. Indices touched lower levels on March 23, nearly 40 per cent lower than January’s highs. But, since then the market has corrected and barring a short period of decline in April 2021, the market is continuously touching new heights. To date, the major indices are more than twice as low as March 2020’s.
In fact, during FY 2021-22, the Indian equity markets have given the best returns in dollar terms as compared to any other market in the world, be it emerging or developed markets, the SEBI Chairman said. The huge growth in secondary market business during this period has further strengthened the market infrastructure. He said that India’s creation for a new world needs further impetus to capital markets and development to meet the financing needs of the emerging economy. However much still needs to be done. At present, the capital market share in total fund raising in India is far behind that of the developed countries.
Mr. Tyagi said that since the beginning of the corona pandemic, the participation of individual investors in the stock markets has increased rapidly. The available figures in this regard are quite shocking. He said that in the year 2019-20, an average of four lakh new demat accounts were opened in the country every month, which increased three times to 12 lakh per month in the year 2020-21. So far in the current financial year, this figure has increased to about 26 lakh per month. The average individual share in the cash market business was 39 percent in the financial year 2019-20, which increased to about 45 percent in the financial years 2020-21 and 2021-22.
The SEBI chairman said that there has been a spurt in raising capital through IPOs recently. In the financial year 2021, Rs 46 thousand crore capital was raised through IPO as compared to Rs 21 thousand crore in its previous financial year. The amount raised through the IPO in the current financial year in just five months till August is close to the amount raised during the previous financial year.
In fact, we are witnessing a completely new world after the pandemic, Mr. Tyagi said. Capital markets have performed extremely well during the pandemic and have helped both investors and companies. However, it is important for investors to be aware of market risks while investing. Also companies on their part need to maintain high standards of corporate governance. The markets, especially the bond market, need to grow further to meet the financial needs of the economy. SEBI is always ready to come up with new ideas and suggestions for further development of capital market.