Sharekhan has over 7 per cent market share in terms of number of accounts, is considered the first independent and third retail brokerage firm in India.
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“Internet focused since its creation in 2000, it is today one of the most well-known online brands in India and has been constantly profitable over the last twelve years, ” BNP Paribas said in a release.
Mumbai: French bank BNP Paribas SA on Thursday announced the acquisition of Sharekhan Ltd, one of the earliest brokerage houses in India. In 2007, the company had bought a 34 per cent stake in a domestic brokerage Geojit Financial. BNP Paribas also operates a retail banking business through its subsidiary Bank of the West with over 700 branches in the Western US.
Although India had seen a surge in retail interest in stocks in the last decade, a crash after the global financial crisis of 2008 drove individual investors away from equities for years, returning to a traditional preference for property and gold. The Bank operates in 75 countries over 147,000 in Europe. It was renamed BNP Geojit Paribas Financial Services and has about 750,000 retail clients. “The purchase of Sharekhan is a unique opportunity for us to build on our achievements in the Indian market and to further expand our business in the country”, he said. The group holds key positions in three major segments: Corporate and Investment Banking, Asset Management & Services and Retail Banking.
The pure-play brokerage had been on the block for some time and many suitors, including leading PEs were said to keen to get on board.
Strong investment bank revenue helped France’s largest bank post net income of 2.56 billion euros ($2.8 billion) for the second quarter, which also benefited from a 420 million gain on the sale of a 7 percent stake in shopping mall group Klepierre (LOIM.PA). This has resulted in brokerage firms working on very low yields.
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Sharekhan (formerly known as SSKI Investor Services) was incorporated in 1995 and started offering broking services to non-institutional clients in 2000. In April 2006, GA Global Investments had entered by acquiring the equity holding of Carlyle in the firm. In the past, it had raised capital from HSBC Private Equity, Intel Pacific Inc and others.
