Investing in the stock market has always been seen as a gateway to wealth creation, but for many Indians, the high price of certain shares has kept them away. Imagine wanting to own a piece of MRF or Page Industries, only to realize that one share costs ₹80,000 to ₹1,00,000 or more. This is where fractional shares in India come into play.
With just ₹500, you could soon be able to own a fraction of a premium stock—thanks to SEBI’s recent steps towards fractional share trading. Let’s break down everything you need to know to get started.
What Are Fractional Shares?
Fractional shares allow you to buy a portion of a single stock instead of paying for the full unit.
Example:
If one share of Company X costs ₹10,000, and you invest ₹500, you’ll own 5% of one share.
This democratizes investing, making high-value stocks accessible to everyday investors.
Current Status of Fractional Shares in India
As of 2025, India does not yet allow full-scale fractional share investing, but SEBI has:
- Approved sandbox trials (with Bengaluru-based startup Xaults leading pilots).
- Proposed a custody-led model where fractional shares are stored at the depository level for better security.
- Indicated that future changes will require amendments to the Companies Act, 2013 and tax laws.
This means fractional investing is coming soon, and Indian investors should prepare now.
Why Start With ₹500?
- Low entry barrier → Begin investing without needing thousands.
- Diversification → Buy fractions of multiple premium stocks instead of being stuck with one low-cost share.
- Learning by doing → Perfect for beginners to understand the stock market without risking big amounts.
- Global trend → In the US, apps like Robinhood and Fidelity allow investing from just $1. India is heading in the same direction.
How to Start Investing in Fractional Shares (Step-by-Step)
1. Choose the Right Platform
Keep an eye on fintech platforms like:
- CakeOS – a new entrant focused on fractional ownership in India.
- Xaults – piloting SEBI sandbox trials.
- Global investing apps like Vested or INDmoney (currently offering US fractional stocks).
2. Set a Budget (₹500 to start)
Fractional investing works best when you invest small but consistent amounts. Begin with ₹500 weekly or monthly.
3. Select High-Value Stocks
Look for companies you admire but couldn’t afford earlier—like MRF, Page Industries, or global giants such as Tesla and Amazon (through international platforms).
4. Understand Corporate Actions
Fractional owners will also get:
- Dividends (proportionally)
- Bonus shares (as fractions)
- Voting rights (depending on SEBI’s framework)
5. Track Performance & Reinvest
Use your investing app’s dashboard to monitor your fractional holdings and reinvest dividends for compounding.