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And now let's move on to an exclusive conversation about the market. My colleagues met with Mr. Ramdeo Agarwal, Co-CEO, Motilal Oswal Financial Services, to talk about the market trajectory, how to deal with market corrections, and the growing cult of equities in India. Let's listen to excerpts from this conversation.
You see, in yoga there is such a thing as pranayama, right? You are constantly breathing in, and then you have to breathe out as well. Yes, it is necessary. If you don't exhale, will you be able to continue inhaling ? No, you can't. Markets work the same way. Every stock, every sector needs to take a breath, and after a big rise, there should be a nice correction.
Sometimes corrections come immediately after a small increase . Of course. Sometimes after a big growth spurt, you know. Therefore, correction is an extremely necessary and important part of the stock market movement. Truth. You have to take it for granted, and that's why it's called a risky asset. It can go up, it can go down.
And that's exactly what most investors don't like . You must understand that this is an integral part. These are just quotation losses. Corrections are quotation losses. These are not real losses. These are losses on quotes. You were overpaid. The share has increased from 100 to 200. You have been overpaid.
Don't pay attention to it. You were paid. You still own the stock. You should have only gotten 160. So 200 should go down to 160. But it won't go down to 160. It will go down to 140. Because the market doesn't have a very precise way of setting a price. This is a very approximate mechanism. You know, he'll take five steps forward, four steps back, then seven steps forward again, and then four steps back, like this.
Recently, words like "foam" and the like have been used in reference to the broader mid- and small- cap stock market. Do you think there should be an even bigger correction? What is happening is you have to understand the factors that are currently driving the market. The factors are the number of investors who come to the market after 75 years.
For the first time, we are witnessing a celebration of retail investing or a triumph of the stock market. Good. Thanks to digital infrastructure, thanks to the simplification of KYC norms and the government's overall commitment that capital formation in the country is extremely important for sustainable growth in the future.
Good. Now, regarding stocks: for a country to grow or for businesses to develop, and for the labor market to grow, businesses need to develop. Businesses will only grow when you provide them with enough equity capital to start at affordable prices. And then debt capital appears. If you have equity, then debt also appears.
But without equity, there is no debt. So the matter is not moving. So, this is clearly happening. We get about 4-5 million customers every month. And this is a record compared to 35-40 million in 2020. Last month we reached the 150 million mark. I think we're headed straight for 300 million. 300 million, and then it's a revolution, and it won't happen overnight.
It will take 3-4 years , and after we reach 300 million, let's first reach 300, and then talk about 600 million. Good. Now the pace is accelerating. Instead of dropping after 4-5 to 4, then to 3.5 and 3, they actually go up from 3 to 4 to 5, and now let's say we did 4.65, a maximum of 65, I don't know the exact number for March.
but my feeling is this : at first only 30-40 million customers were satisfied, so they brought their brothers and sisters , and now 150 million are satisfied. So, whole society after society comes, as if a whole city, a whole town, a whole house comes. so now there is much more momentum and perception.
the very concept of investing part of your savings. Look, in '23-24, as of this Friday, the figures showed that we had collected about 17 lakh crore fixed deposits . bank deposits increased, I think, by 13%. and 103, so I think 17-18 lakh crores has come in. I think the stock market gained around 3-4 lakh crores in the same period.
maybe 5 lakh crores . so only, I mean, only a quarter. or a third of fixed deposits . This is not entirely correct, eventually they should become almost equal. Of course. but it could take five to seven years, so we are at the epicenter of a huge shift in the distribution of savings in the economy, and it will happen.
This takes time, and the economy also needs to show results. OK. To get more news and updates, simply subscribe to CNBC TV18 on all our digital platforms.
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