From mint · · 1m
Booming Leverage in Indian Stocks
Stock brokers borrow $33 billion to fuel India's leveraged equity bets.
In brief
Stock brokers borrow $33 billion to fuel India's leveraged equity bets. Indian stock brokers raised $33 billion in short-term debt to support growing margin trading, risking market stability as leverage positions hit record levels. Originally reported by mint.
Brokers dominate debt market
Stock brokers borrowed billions of dollars to finance investors' growing appetite for leveraged equity bets.
21% CP issuance surge
Brokers accounted for 21% of commercial paper issuance this year, up from 4% in 2021.
$33 billion debt raised
Brokers raised 3.2 trillion rupees ($33 billion) through commercial paper issuance.
Record leverage positions
Leveraged equity positions reached 1.6 trillion rupees as of September 30.
Funding shift from banks
Reserve Bank of India curbed bank lending to proprietary trading firms in February.
Market stability concerns
Zerodha Broking warned a sharp market decline could risk margin-loan business growth.
At a glance
Indian stock brokers raised $33 billion in short-term debt to support growing margin trading, risking market stability as leverage positions hit record levels.
