Interviews

Digital Transformation 2023

CXOToday has engaged in an exclusive interview with Jones George, Executive Director at Geojit Financial Services

 

  • What are your expectations/ views on the current Digital Broking Industry in 2023 and how is Geojit operating in the Digital space?
    • In the current business environment, thanks to our regulators and the ecosystem participants, digital has become the norm. Geojit, pioneered online trading in India 2 decades ago. We have always been a digital first company. Despite operating close to 500 physical offices, more than 75% of our trading volumes are from online. Digital services are also increasingly becoming commoditized. So if one broker is able to offer a particular service, it is a matter of time before the industry follows.

 

  • The recent spike in use of AI tools such as ChatGPT, OpenAI etc., are we entering into a new age of consumer-technology? How will this affect the Digital Broking industry?
    • The use cases of AI by the masses is still in a learning phase. If you look at ChatGPT or OpenAI, there is room for improvement but it shouldn’t be too long for the accuracy to go up. In the broking industry, we see AI being used largely by institutions. Research institutions and large traders use it for identifying good stocks and opportunities. I think it will be good for brokers if we are able to collaborate with such institutions and offer their services to clients. I have also heard of good individual programmers creating their own algorithms and placing trades.

 

  • With the recent regulations announced by SEBI on influencers & youtubers on stock manipulation, what is your advice to retail & small time investors?
    • This is a very good move by regulators. For most of the Covid phase, market was moving in one direction. A lot of people got lucky and made money but this also gave them the feeling that they have mastered trading and therein became evangelists. I have personally seen how people I wouldn’t expect to be trading, to be placing large bets without understanding the nuances just because they saw some video on YouTube. Despite the one directional market movement, SEBI’s study shows a surprisingly large number of people making losses. So the SEBI regulation on influencers is very much called for. There is no free lunch in this world. Audience also have to note that influencers are often making money through commissions from brokers. Ideally, the influencers should be declaring whether they are getting such commissions also.

 

  • How do you see the Indian IT sector performing in 2023? What are your views from an investment perspective, given the recent news of massive layoffs & hiring in big Tech companies?
    • Based on the Q4 earnings report, the IT sector is expected to see moderate growth this year owing to ongoing challenges in the BFSI industry and concerns about global slowdown. However, the industry’s outlook remains neutral as renewed demand for cloud and digital transformations and healthy deal wins provide revenue visibility. Many U.S. companies have already downsized their workforce in preparation for the recession, potentially boosting future profit margins and improving the bottom line. Meanwhile, Indian IT majors have softened their hiring processes due to the sluggish pace of global business and delays in project spending. The industry valuations have corrected by more than 1/3rd in the last 1.5 years limiting future underperformance. It is presenting an opportunity for long-term investors to adopt an accumulation strategy in 2023-24. Currently we have a stock-to-stock approach with a possibility to uprate the industry rating in the future.

 

  • How has technology brought about a change in the Full-service & Discount Broking Industry? What lies ahead for both the industries?
    • Full service brokers, as the name suggests, is able to provide a wide gamut of products in addition to building relationships and offering personalised service. Customers of full-service brokers want more than a platform to transact in. Discount brokers are a good fit for those clients who are able to manage their investments and trades on their own. So, a platform and faceless relationship are good enough. Collectively, growth opportunities are large for both kinds. Capital market is still underpenetrated as far as the population is concerned.

 

  • Any advice for new age & first-time investors going ahead in 2023? 
    • The most important investment in the world is investing in yourself. Focus on your personal growth. Investments are meant to be long term. Speak to a regulated advisor or distributor and start with SIPs. As you grow in your career, enhance your SIPs proportionately and do a periodic review.

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