Tuhin Kanta Pandey Says India Investor Base May Double

The distinctive investor pool in India may potentially double within three to five years due to the current low level of equity participation, stated Tuhin Kanta Pandey, Chairman of the Securities and Exchange Board of India (Sebi), on Monday.

Pandey highlighted that ongoing economic growth will be essential for directing a greater portion of domestic savings into capital markets. “Moving ahead, this expansion is the primary reason we can allocate our internal savings into our capital market,” he stated at the CII National Financing Summit.

He observed that Indian families and local entities currently possess a greater portion of listed equities compared to foreign portfolio investors (FPIs), and the nation is home to roughly 135 million distinct market participants.

A recent nationwide Sebi survey indicated that 63 percent of those surveyed know about the securities market, yet only 9.5 percent of households are currently investing. An additional 22 percent are thinking about entering the markets in the upcoming year a trend Pandey indicated imposes a “significant responsibility” on regulators, issuers, and intermediaries to guarantee the safety and quality of offerings.

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Pandey noted that India’s capital markets continue to be bolstered by robust domestic fundamentals and increasing household involvement, despite global uncertainties  such as worries about possible corrections in the US market — presenting risks.

"External risks will always exist, whether they stem from trade or global financial markets." India’s growth narrative is backed by strong fundamentals, demographics, a vast talent pool, and ongoing public and private investment. He stated, “These elements, together with investor confidence, serve as a barrier to disruptions.”

He mentioned that Sebi is still collaborating closely with the Reserve Bank of India on models that monitor interconnected risks, such as liquidity strains and redemption pressures in mutual funds.