Summary of this article
The total number of demat accounts surged to 210 million in October
Over 30 lakh new demat accounts were added in October
The high number of demat account additions come at a time when equities have underperformed other assets on a YTD basis.
October CDSL Data: Retail participation in the stock market witnessed a strong increase in October 2025. The total number of demat accounts in India grew to a record high of 210 million, according to data from the NSDL and CDSL. The number of accounts registered on CDSL grew to 167.7 million in October, and the number of accounts registered on the NSDL grew to 42.3 million.
On the other hand, the number of new account additions also surged to a 10-month high in October. As per data from the depositories, over 3 million new demat accounts were added in October. Notably, this is the highest demat addition seen in the last ten months.
Gold vs Equity Performance In India
The record high number of demat accounts indicates strong investor interest in equities. However, so far in 2025, the returns generated by the headline indices have remained lower than the returns offered by other assets such as gold due to heightened volatility amid uncertainties created by the imposition of reciprocal tariffs and instances of geopolitical tensions between Russia-Ukraine and Israel and its neighbouring countries.
The price of 24 karat gold has grown by nearly 58 per cent to Rs 12,322 per gram on November 10, compared to Rs 7,800 per gram on January 1. The price of 22 karat gold has also grown by 57 per cent to Rs 11295 per gram compared to Rs 7150 per gram on January 1. However, year-to-date, the Sensex has moved 6.89 per cent and the Nifty has moved 8.47 per cent. Thus, it becomes important to understand what is driving the surge in demat additions despite the underperformance.
What’s Driving The Surge In Demat Additions
The month of October points towards a shift in investor preferences from safe-haven assets to equities. Here’s a look at some of the key reasons driving the shift:
Return Of FIIs
After remaining net sellers of Indian equities for several months, foreign Institutional investors (FIIs) turned bullish on Indian equities and emerged as net buyers in October, investing nearly $1.6 billion into domestic equities. The injection of funds by FIIs increased investor confidence and liquidity.
Resilient IPO Market
The month of October 2025 turned out to be a busy one for the stock market. The month was the busiest month for the mainboard as 10 companies raised more than Rs 44,930 crore from the primary market. Notably, the record high monthly fundraise was led by Tata Capital and LG Electronics India, which raised Rs 15,512 crore and Rs 11,607 crore from the market collectively.
Dr V K Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, told Outlook Money that while IPO related activity became a strong reason for demat addition in October, retail interest in stocks, mutual funds and IPOs cumulatively drove the number of demat accounts to a record high.
“A healthy trend in the investor activity in India is the steady increase in investment through MF SIPs, which has crossed Rs 29,000 crores in September. This is a reflection of healthy and informed retail investment for the long-term. Retail investors investing directly in stocks are also showing a rising trend. Traders trading in F&O have declined thanks to SEBI regulations. This is also a desirable trend. An area of concern, however, is frenzied in discrete retail activity in IPOs. An increasing number of demat accounts is the cumulative result of retail interest in stocks, mutual funds and IPOs,” Vijayakumar said.
Stabilising Market Conditions
After a year driven by uncertainties, the Indian stock market underwent some stabilisation in the month of October as the Reserve Bank of India (RBI) maintained the repo rate at 5.5 per cent, the domestic fundamentals of the economy remained strong with a projected GDP growth of 6.8 per cent for FY26. The Q2 FY26 earnings season also turned investor sentiment positive.
Easing Global Fears
The Indian market also benefited from a moderation of global uncertainties in October. While trade tensions continued to remain a cause for concern, progress in the U.S.-China trade talks and a slightly less aggressive stance from the U.S. Federal Reserve eased some risk-off sentiment toward emerging markets.
Gold vs Equity Returns Stabilise
The Sensex and Nifty both advanced approximately 3 per cent in October, while the broader BSE MidCap and SmallCap indices showed even stronger gains, rising 4 per cent and 3 per cent, respectively. Positive returns tend to shift investor sentiment. Additionally, the returns generated by equities caught up with the returns generated by gold as the yellow metal’s price advanced 3.4 per cent in October.
