Stock market in India - statistics & facts
The Indian stock market is one of the oldest in Asia, boasting a rich history dating back to 1875. This was the year the Bombay Stock Exchange (BSE), the country's first stock exchange, was established. What originated as trading under a banyan tree in front of Mumbai’s town hall in the 19th century has now evolved into electronic trading in a prominent landmark building on Dalal Street in downtown Mumbai.
Following economic liberalization in the early 1990s, the Indian stock market landscape significantly transformed. The National Stock Exchange (NSE) of India was established in 1992 with the aim of enhancing transparency in the Indian equity market and providing inclusive membership opportunities that were not available with the BSE at that time. Both the BSE and NSE, have played a pivotal role in shaping the Indian capital market into what it is today.
Despite its robust growth, the market faces two major challenges: corporate governance issues and market volatility. Cases of corporate misconduct undermine investor trust and hinder market growth such as the Satyam Computer Services scam in 2009. Moreover, the industry is susceptible to global economic changes and geopolitical events, which may discourage cautious investors. Most recently, this included the General Elections in India between April and June.
Following economic liberalization in the early 1990s, the Indian stock market landscape significantly transformed. The National Stock Exchange (NSE) of India was established in 1992 with the aim of enhancing transparency in the Indian equity market and providing inclusive membership opportunities that were not available with the BSE at that time. Both the BSE and NSE, have played a pivotal role in shaping the Indian capital market into what it is today.
Impact of liberalization on the stock market
The liberalization of the Indian economy welcomed foreign investments, leading to an influx of capital and subsequent rapid market expansion. Foreign institutional investors provided liquidity to the market, fostering stability and growth. In 1992, establishing the Securities and Exchange Board of India (SEBI) marked a significant milestone, introducing regulatory changes that enhanced market transparency, improved corporate governance, and curbed market manipulation. Furthermore, the introduction of electronic trading systems in 1994 bolstered transparency and efficiency in trading. Overall, the liberalization process transformed the Indian stock market into a robust, transparent, and globally competitive platform.Navigating ascent and turbulence: India’s stock market story
In recent years, India has surged into the top five ranks globally in terms of stock market capitalization. This ascent has been reinforced by the groundbreaking initial public offering (IPO) of the Life Insurance Corporation (LIC) of India, solidifying India's status as a key player on the global stage. Various other contributing factors include a burgeoning GDP, a demographic dividend, increasing disposable income, technological advancements, and a robust domestic investor community. India boasts a youthful population, offering a significant pool of potential new investors entering the capital market each year. Moreover, the expanding middle class and rising disposable incomes have bolstered investment activities. The accessibility of online trading platforms has further democratized investments, drawing in a broader base of investors.Despite its robust growth, the market faces two major challenges: corporate governance issues and market volatility. Cases of corporate misconduct undermine investor trust and hinder market growth such as the Satyam Computer Services scam in 2009. Moreover, the industry is susceptible to global economic changes and geopolitical events, which may discourage cautious investors. Most recently, this included the General Elections in India between April and June.
