Online broking for India
Tuesday, 14 December, 1999, 16:07 GMT
Indians can look forward to online trading
By Sanjeev Srivastava in Bombay
India's giant Tata group has announced plans to launch online broking in partnership with one of the world's largest discount broking firms.
Tata Finance said it planned to join hands with TD Waterhouse in a deal in which the Indian company would hold a 51% stake.
The new company should be able to execute its first order on the Internet in about a year, according to Baroz Gazdar, vice-president of Tata Finance.
By that time, she said, the Securities and Exchange Board of India (SEBI) should put in place a well defined set of cyber-laws in the country.
TD Waterhouse will investing about 700m Rupees ($16m) in return for a 49% stake in Tata Securities, a wholly-owned broking subsidiary of Tata Finance.
Large network
Information and telecom technology has leapfrogged in India in recent years and online trading is a natural sequel to the developments taking place in the market place, Ms Gazdar said.
Most trading is done over the phone
The global reach and technology expertise of TD Waterhouse combined with the Tata Finance network placed the joint venture company in an ideal position to capture a big share of the domestic retail investment portfolio, she said. Tata Finance has a network of 75 branches and a customer base of 600,000.
There are about 25 million investors in India who account for nearly half a million transactions a day.
Changing tradition
Online trading in equity, debt instruments and government securities should result in an exponential rise in trading volumes, resulting in lower transaction costs, according to Mehul Desai, a Bombay stock broker.
Tata Finance officials will be targeting high-end retail investors and Ms Gazdar said the company expected to have an account base of nearly 100,000 investors in its first year of operations.
Compared to the size of the Indian market and the number of investors, it is not a very ambitious target...(BBC News) |
