Ahmedabad, Mar 19: Islamic laws may bar the faithful from investing in any financial instrument that yields interest, including shares, but a financial services provider has been helping Muslim investors reap profits from the market without breaking the ‘Shariyat’ code.
Parsoli Corporation, which provides stock broking and portfolio advisory services, has been encouraging investors from the Muslim community to invest only in scrips of those companies that manufacture and sell products and not in shares of banks, whose core business is earning interest.
This system, Parsoli, claims does not violate the Islamic code and it has been trying to convince both religious heads and people to invest in the capital market.
"The average portfolio of investment by Muslims into the share market has increased by 50 per cent in just over one year’s period and since the stock market has been soaring," Parsoli’s Zafar Sareshwala, who was instrumental in popularising the unique investment method in India, told mediapersons.
Parsoli reorganised itself last year after being destroyed during the 2002 sectarian violence in Gujarat, he said, adding that the popularity of "Islamic Index" has risen since then on the back of the upward spiral in the bourses, including the Bombay Stock Exchange (BSE).
Ahmedabad was chosen to launch the wealth management service given the fact that Muslims in Gujarat have the highest per capita income and are among the most educated as compared to other states of the country.
"Moreover, India has about 200 million Muslims and a lot of untapped Muslim wealth, which is a huge market for our company", Sareshwala said, adding that after Ahmedabad and Mumbai, his company is looking to open similar centres in Chennai, Kolkata, Hyderabad, Delhi, Kanpur, Lucknow and other cities of India having Muslim population of over three lakh.
The company also intends to provide insurance products to vast majority of Muslims, who do not have these products, he said, adding that the company proposes to have a strategic alliance with some insurance companies and design tailor-made schemes that are ‘Shariat’ compliant.
By managing the huge untapped wealth of Muslims in the country, the company wishes to integrate the community into the economic mainstream of India, Sareshwala said.
The company is an RBI registered full-fledged money changer and has a 100 per cent subsidiary in the UK, which conducts similar business across European countries.
Parsoli, in collaboration with IBF-net, has compiled Parsoli IBF, NSE equity index, India’s first and only Islamic equity index, comprising the most liquid stocks of Shariat compliant companies that are registered on the NSE and the BSE.