SHCIL pens two-pronged strategy to boost volumes

Sujoy Manna

Mumbai, July 15: Hit BY the recent crisis in the stock markets and falling business volumes, the Stock Holding Corporation of India (SHCIL) has initiated business reorganisation to enhance volumes by targeting the retail investors.

Currently, SHCIL’s main clients belong to corporates and financial institutions.

The company has chalked out a two-pronged strategy of retention and acquisition to bring back its business volume.

Under the retention strategy, the company expects to tap the intrinsic value of the existing client base. SHCIL is planning to come out with more products to broaden its client base.

In its move to target a cross section of retail clients, SHCIL has set up a cell for high net worth individuals (NHI), apart from the existing NRI cell.

Also, there will be cross-selling of products to these HNIs and grouping of accounts under a principal client ID to club all communications under one head, which would simplify customer relationships.

Further, SHCIL plans geographical tariff customisation which implies differential tariffs across various cities. This means, a investors in a city with low number of HNIs or with low per capita income will be charged less, compared to investors in metros like Mumbai.

Also, as part of expanding its reach and increasing its market share, it plans to acquire more number of depository participants.

Under its acquisition strategy, SHCIL plans to acquire smaller DPs along with mass mobilisation of corporate clients, develop franchisee network and increase tie-up with banks and intermediaries.

Speaking to The Financial Express, SHCIL managing director and CEO BV Goud said, “We are internally reorganising ourselves and laying greater thrust on marketing efforts. We are strengthening our regional offices and senior personnel are being posted there to improve the service of the business.” SHCIL is also acquiring some smaller depositories with a view to increasing its market share, added Mr Goud.

The recent stock market crisis has hit the business volumes of the company.

The falling volumes of business at the bourses, which have went down from Rs 6,000 crore to below Rs 2,000 crore, have affected the company’s financials adversely leading to some cost cutting measures.

However, SHCIL is expected to improve its profitability with the revival of the market.

The company has relaunched a number of products like Securities Lending Scheme and Sell-N-Cash, which had been temporarily suspended.

SHCIL is also developing a software for the brokers’ community to help them take care of their back offices.

With the introduction of rolling settlement, brokers have to make huge investments for upgrading their back offices.

Brokers with high net worth can individually develop these softwares but smaller brokers do not have the resources to develop it. The software developed by SHCIL specially caters to this segment of the market.