India’s capital markets revenue pool is projected to expand at a compound annual growth rate (CAGR) of 16% between FY26 and FY30, supported by increasing household financialisation, wider equity participation and the growing availability of investment products, according to a Macquarie Research report.
The report noted that Indians save around USD 500 billion each year through financial assets. Nearly half of these savings are held in cash and deposits, creating substantial potential for market-linked investment products.
“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.
Financialisation and Retail Participation Drive Growth
Macquarie said the increasing financialisation of household savings represents a long-term structural shift. Rising GDP per capita, the formalisation of savings and greater participation in both physical and financial assets are expanding the pool available to capital markets.
The report also highlighted increasing equity participation and a wider range of investment products as important factors supporting the growth of stock exchanges and digital brokerage platforms.
Despite the increase in participation, India’s capital markets remain relatively underpenetrated. Around 3% of the population is active on the NSE, while approximately 4% owns mutual funds, according to the report.
At the same time, the number of demat accounts has increased significantly, rising from 21 million in FY13 to around 225 million in FY26. Account additions have accelerated since FY20, indicating stronger retail participation in the capital markets.
Systematic investment plans (SIPs) have also contributed to the expansion of retail investing. Annual SIP inflows rose from below Rs 1 lakh crore in FY19 to around Rs 3.5 lakh crore in FY26. Monthly SIP inflows have remained above Rs 30,000 crore since the beginning of FY26, the report said.
Stock Exchanges Expected to Maintain Revenue Growth
Macquarie expects stock exchanges to achieve annual revenue growth of around 13% through FY30. Transaction-related revenue is projected to increase by approximately 12% each year, while non-transaction revenue could grow at about 15% annually.
The brokerage expects areas such as data, connectivity, listings and index-linked products to contribute increasingly to exchange revenues. A larger contribution from these segments could reduce exchanges’ dependence on trading volumes and provide greater visibility to their revenue streams.
However, the report identified the Closing Auction System (CAS) as a near-term factor that could affect market activity. Macquarie estimates that its impact on equity, derivatives and margin-trading volumes could continue for two quarters while market liquidity and trading strategies adjust.
Capital Allocation Could Become More Important
Looking towards the coming years, Macquarie said the focus within India’s capital markets ecosystem is likely to shift increasingly towards cash generation and how companies deploy their capital.
“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.
The brokerage expects continued financialisation, expanding retail participation and broader investment offerings to remain important factors shaping the capital markets revenue pool through FY30.
Disclaimer: This article is based on findings and projections attributed to Macquarie Research and reported by ANI. Market projections and estimates are subject to changes in economic conditions, investor participation and market performance. This article is for informational purposes only and should not be considered investment advice.