ICICI Securities Limited: history, ownership, mission, how it works & makes money

A Brief History of ICICI Securities Limited

ICICI Securities Limited, a prominent player in the Indian financial services sector, was established in 1995 as a subsidiary of ICICI Bank. The company was created to provide a comprehensive range of financial services, including investment banking, retail and institutional brokerage, and financial advisory services.

In 2000, ICICI Securities became a pioneer in online trading with the launch of its trading platform, making it easier for retail investors to participate in the stock market. This innovation positioned the company favorably in a rapidly evolving financial landscape.

By 2007, ICICI Securities had achieved substantial growth, reporting a net profit of approximately ₹561 crore for the fiscal year. The company's focus on technology and customer service helped it capture a significant share of the retail brokerage market, making it one of the largest brokers in India.

The company went public in 2018, listing its shares on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The initial public offering (IPO) was well-received, raising about ₹4,000 crore

In the fiscal year ending March 2023, ICICI Securities reported a revenue of approximately ₹3,400 crore, up from around ₹3,000 crore in the previous year. The net profit for the same period was reported at ₹1,140 crore, reflecting a margin of about 33.5%.

As of October 2023, the company boasted a strong customer base, with over 6 million active retail accounts, allowing it to maintain a market share of approximately 10.6% in the retail equity brokerage segment.

As part of its strategic initiatives, ICICI Securities has expanded its service offerings to include mutual funds, insurance products, and portfolio management services, aligning with market trends that favor integrated financial services. The ongoing digitization and adoption of mobile platforms have further enhanced customer engagement and transaction volumes.

ICICI Securities continues to focus on customer-centric approaches and employs a robust risk management framework to navigate the dynamic market environment. The company is well-positioned to capitalize on the growth of the Indian financial market, driven by increasing retail participation and a favorable regulatory framework.

A Who Owns ICICI Securities Limited

ICICI Securities Limited, a key player in the Indian financial services sector, is primarily owned by ICICI Bank Ltd. As of September 2023, ICICI Bank holds approximately 67.62% of the total equity stake in ICICI Securities. The remaining shares are distributed among various institutional and retail investors.

Shareholding Structure

As per the latest filings, the company has witnessed a steady increase in foreign institutional investments, which rose by 3.2% year-on-year. In comparison, retail investor participation has remained strong, reflecting a growing interest in the equities market.

Recent Financial Performance

ICICI Securities has shown robust growth in its financial performance over the last fiscal year. For the fiscal year ending March 2023, the company reported a total income of ₹3,345.82 crore, showcasing an increase of 20.5% compared to the previous year. Its net profit for the same period was ₹1,257.34 crore, an increase of 25%.

Market Capitalization

As of October 2023, ICICI Securities had a market capitalization of approximately ₹27,000 crore. The company's stock has performed well, with a year-to-date return of about 29%.

Institutional Ownership Trends

The institutional ownership of ICICI Securities indicates confidence among large investors. Data shows that as of September 2023:

The company's diverse ownership reflects a balanced mix between institutional and retail stakeholders, which is essential for stability in stock price and overall corporate governance.

Conclusion

Overall, ICICI Securities Limited enjoys a stable ownership structure with significant backing from its parent company, ICICI Bank Ltd. and a healthy distribution among institutional and retail investors. This structure supports the company's strategic objectives and growth in the competitive financial market.

ICICI Securities Limited Mission Statement

ICICI Securities Limited aims to provide a comprehensive range of financial services and solutions to its clients. The mission statement emphasizes a commitment to delivering innovative and efficient financial products, fostering trust and transparency in all dealings.

The company is focused on enhancing customer experience through technology, aiming to make investing easier and more accessible for retail and institutional investors alike. This dedication is reflected in their continuous efforts to evolve and adapt to market dynamics.

Key Elements of the Mission Statement

• Client-Centric Approach: Focusing on the needs and preferences of clients.
• Innovation: Commitment to pioneering new financial solutions.
• Integrity: Maintaining high ethical standards in all interactions.
• Transparency: Ensuring clarity in communication and operations.

Financial Performance Indicators

As of the latest financial year, ICICI Securities Limited reported significant numbers reflecting its operational efficiency and market position. Below is the financial summary for the year ended March 31, 2023:

ICICI Securities has expanded its market presence and technological capabilities, as illustrated by its growing client base and transaction volumes. The number of active clients reached approximately 6.5 million by the end of fiscal year 2023. The company has also witnessed a substantial year-on-year growth in the retail brokerage segment, with a market share of around 9.5%.

Technological Integration

The mission statement underscores the importance of technology in ICICI Securities' operations. The company has invested heavily in digital platforms, resulting in an increase in mobile application downloads exceeding 10 million in 2023. This has enhanced customer engagement and facilitated a seamless trading experience.

Moreover, ICICI Securities has improved its risk management frameworks, ensuring regulatory compliance and safeguarding client interests. This aligns with their mission of maintaining integrity and transparency.

Community Engagement

Aligned with its mission, ICICI Securities is actively involved in community initiatives, including financial literacy programs. In 2023, the company reached out to over 150,000 individuals through various workshops and seminars aimed at educating potential investors about financial markets and investment strategies.

Overall, ICICI Securities Limited’s mission statement serves as a guiding principle in its operations, reflecting its commitment to innovation, client satisfaction, and ethical practices in the financial services industry.

How ICICI Securities Limited Works

ICICI Securities Limited operates primarily in the financial services sector, offering a variety of products like equity and derivatives trading, mutual funds, and investment advisory services. The company is a part of the larger ICICI Group, one of India’s foremost financial conglomerates.

The company provides retail and institutional clients with comprehensive financial services. As of the latest fiscal year, ICICI Securities reported a revenue of ₹4,249 crores (approximately $570 million) for FY 2022-23, with a net profit of ₹1,346 crores (around $180 million), reflecting a strong operational performance.

ICICI Securities has a robust online trading platform, which has gained significant traction among retail investors. It recorded over **9.1 million** active clients as of Q2 FY 2023, a **19%** increase year-over-year. The brokerage offers a range of services including:

• Equity Trading
• Derivatives Trading
• Commodity Trading
• Mutual Fund Investments
• Initial Public Offerings (IPOs)
• Portfolio Management Services (PMS)

The company focuses on technology-enabled services, which has allowed it to maintain a competitive edge. Its mobile application, ICICI Direct, is one of the leading platforms in India for trading and investment, recording a significant user engagement and customer satisfaction rate.

ICICI Securities operates on a commission-based model for trading activities, earning revenue from transaction fees. The average revenue per user (ARPU) for the brokerage in FY 2022-23 was around ₹3,500 (about $47), with transaction volumes reaching **₹6.54 lakh crores** (approximately $88 billion) during the same period.

Furthermore, ICICI Securities has been focusing on expanding its market share by enhancing customer experience through personalized services and innovative products. The company has invested significantly in research and analytics to provide actionable insights to its clients.

As regulatory frameworks in India evolve, ICICI Securities is well-positioned to adapt. The Securities and Exchange Board of India (SEBI) has introduced measures to make markets more accessible and transparent, which aligns with ICICI's commitment to sustainability and responsible business practices.

For the quarter ended September 2023, the company reported a total income of ₹1,099 crores, showcasing a **12%** increase year-over-year. The net profit for the same period was ₹413 crores, reflecting sustained growth and profitability.

The competitive landscape in the brokerage sector is intensifying with various fintech players emerging. However, ICICI Securities remains a formidable player, leveraging its technology and brand reputation to retain customers and attract new ones.

How ICICI Securities Limited Makes Money

ICICI Securities Limited (ICICI Securities) generates revenue through various segments, including brokerage services, investment banking, and asset management. The company's diversified business model allows it to tap into multiple revenue streams effectively.

Brokerage Services

Brokerage services account for a significant portion of ICICI Securities' revenue. In FY2023, the company recorded a total brokerage income of ₹2,062 crore, which represented a growth of **24%** compared to FY2022.

Equity and Derivatives Trading

Within brokerage services, equity and derivatives trading activities are core. The company reported an average daily turnover of ₹33,000 crore for equity trading in FY2023. The market share in equity trading stood at **7.5%** as of March 2023.

Mutual Fund Distribution

ICICI Securities also earns from mutual fund distribution. In FY2023, the mutual fund distribution revenue reached ₹400 crore, driven by a **30%** increase in assets under management (AUM). The total AUM in mutual funds was reported at ₹20,000 crore.

Investment Banking

Investment banking is another critical area for revenue generation. ICICI Securities was involved in advisory services for **25** mergers and acquisitions (M&A) in the last fiscal year, garnering advisory fees of ₹300 crore. The underwriting services contributed ₹200 crore during the same period.

Key Financial Metrics from Investment Banking

Asset Management

ICICI Securities also provides asset management services. The company reported an asset management revenue of ₹250 crore in FY2023. The total assets managed were around ₹10,000 crore, reflecting a **15%** growth year-over-year.

Wealth Management Services

The wealth management segment contributed ₹150 crore to the overall revenue in FY2023. The segment saw a significant uptick in client engagement, with a **20%** increase in the number of high-net-worth individual (HNWI) clients.

Digital Platforms and Technology

With the rise of digital trading, ICICI Securities has invested in technology platforms. Earnings from online trading platforms reached ₹300 crore, constituting **15%** of the total brokerage income. The company boasts over **5 million** active users on its digital platforms as of March 2023.

Revenue Breakdown by Segment

Conclusion of Revenue Sources

The combination of these segments allows ICICI Securities Limited to create a robust and sustainable business model. The continual growth in these core areas indicates a healthy outlook for the company's future revenue generation. For FY2023, the total revenue reached ₹3,262 crore, marking a significant year-over-year increase.