Small towns join Dalal Street party, bull run reaches Sundarbans

Due to increasing interest and engagement in equity markets, small and semi-urban regions are playing a significant role in India’s growth narrative.

According to a ToI report, West Bengal’s North 24 Parganas, home to the Sundarbans yet virtually unknown to many, has been among the biggest contributors of new stock market investors since Sept 2023. In May, Delhi and Mumbai led in new investor registrations, while Surat, Ahmedabad, and Jaipur also saw substantial increases in fresh registrations.

According to NSE, the top 10 districts contributed nearly 19.4% of new investors in May. At the state level, Maharashtra maintained its lead with 1.6 crore registered investors, accounting for 17% of the total. Uttar Pradesh became the second state in the country to surpass one crore investors.

UP contributed about 11% to the investor base against 6.1% in 2010, and has seen its share nearly quadruple since the pandemic, NSE data showed.

The increase in participation from emerging regions indicates a shift in investment preferences from mutual funds to comparatively riskier equities, which have also been resilient to recent withdrawals by Foreign Portfolio Investors (FPIs). Venkat Chalasani, chief executive at Amfi, attributes the rising participation by small-towners to a confluence of factors.

“Rising financial literacy, the vital role of AMCs, and the dedicated distributor fraternity in fostering a culture of informed investing are a few drivers. The transformative impact of fintech innovations have also played an important role,” he told ToI.