India’s capital markets revenue pool is expected to grow at a 16 per cent CAGR between FY26 and FY30, as rising household financialisation, deeper equity participation and wider product offerings drive the next phase of growth, Macquarie Research said in a report.
Indians save around USD 500 billion annually in financial assets, with nearly half of the amount held in cash and deposits, creating a significant pool for market-linked products and driving strong growth in India’s investment, wealth and exchange revenue pool.
“Indians save $500bn annually in financial assets and almost 50% of that is in cash and deposits. This pool is ready for market-linked products which will drive a 16% CAGR in India’s combined investment & wealth and exchanges revenue pool over FY26-30E,” the brokerage said.
The report said financialisation, driven by rising GDP per capita, formalisation of savings and increasing participation in physical and financial assets, represents a long-duration structural shift that is steadily expanding the addressable pool of household savings.
It added that the combination of financialisation, greater equity participation and wider product offerings is creating a “powerful operating flywheel” for stock exchanges and digital brokers.
According to the report, India’s capital markets remain underpenetrated, with only around 3 per cent of the population active on the NSE and approximately 4 per cent owning mutual funds.
However, the country’s demat account base has expanded sharply, rising from 21 million in FY13 to around 225 million in FY26. The pace of account additions has also accelerated since FY20, reflecting growing retail participation in capital markets.
Retail investment has received further support from systematic investment plans (SIPs). Annual SIP inflows increased from below Rs 1 lakh crore in FY19 to around Rs 3.5 lakh crore in FY26, while monthly SIP inflows have remained above Rs 30,000 crore since early FY26, the report said.
Macquarie expects stock exchanges to record around 13 per cent annual revenue growth through FY30. Transaction revenues are projected to grow at about 12 per cent annually, while non-transaction revenues are expected to expand at around 15 per cent.
The brokerage said the increasing contribution of data, connectivity, listings and index-linked products could diversify exchange revenues, reducing their dependence on trading volumes and improving revenue visibility.
However, the report flagged a near-term disruption from the Closing Auction System (CAS), estimating that its impact on equity, derivatives and margin-trading volumes could persist for two quarters as market liquidity and trading strategies adjust.
Looking ahead, Macquarie said the capital markets ecosystem is entering a phase in which cash generation and capital deployment will become increasingly important.
“The core of the thesis is simple: India’s capital markets ecosystem is moving into a phase where operating leverage has largely played out, and capital allocation will increasingly determine outcomes,” the report said.
-(ANI)
