Sharekhan Fires 400 Employees Due To Slowdown In Sharemarket, Rising Online Broking Model
India’s 3rd biggest retail brokerage firm: Sharekhan has decided to fire 400+ employees from their payroll.
Some of the reasons which have been attributed to this massive layoffs from Sharekhan are digitalization of their operations, and a prolonged slowdown in the stock market.
If we believe the reports, then many more employees will be asked to leave, in the coming days.
Sharekhan, owned by BNB Parihas now, has asked 400+ employees to leave.
This has been confirmed by an insider, who said, “Nearly 400 employees have been asked to go and more will be asked to go over the next few weeks,”
As it is the case with most of the layoffs, dwindling revenues, and a shift in technology along with the slowdown in stock market have been attributed as the primary reasons for these layoffs.
Sharekhan has issued a statement, wherein they have admitted to asking 350 employees to quit.
They have mentioned the primary reasons as digitalisation and a subsequent ‘restructuring’.
The statement said, “Our business is evolving to meet the more complex needs of our clients, including through the provision of value-added advisory services where we have been hiring. In line with our clients’ expectations, we have also moved to provide more digital services. Through this digitalization and restructuring, which is ongoing and will continue in a phased manner over the next few months, around 350 colleagues are impacted.”
Digitalisation Is The Main Reason
BNB Parihas owned Sharekhan has recently shifted to a new digital based online broking model, which has made jobs of of hundreds of employees redundant.
Earlier, Sharekhan grew and expanded via franchise model, but due to overwhelming rules and regulations, they decided to change to a new digital based model.
Now, the rising cost of technology, and deep discount model adopted by their competitors has forced Sharekhan to change their business model.
And it seems that less humans are now actually required.
Stock Market Slowdown Another Reason?
Sine January, 2018, BSE’s Mid-cap and Small-cap indices have dropped 19 per cent and 30 per cent, respectively.
As per some analysts, this slowdown in stock market is another major reason for Sharekhan to reduce their employees, and absorb the losses.
This slowdown is impacting other stock brokerage firms as well: Motilal Oswal Financial Services’ net profits reduced by 46%; Geojit Financial Services reported a drop of 61% and Emkay Global’ reported whooping 70%d drop in profits.
Sharekhan as approximately 4500 employees.
We will keep you updated, as more details come in.