It's no secret that investors are returning to the Dalal Street. But the big news is that the intermediaries (read brokers) are doing so too.

Foreign institutional investors are pouring money into the markets, and small brokers who have been planning to switch off trading terminals and surrender broking cards for the past few months are now reconsidering.

What's more, brokerage houses are now in expansion mode - they are looking out for research analysts and dealers.

Motilal Oswal, managing director of the Mumbai-based Motilal Oswal Securities, said: "After a two-year lull, business conditions are improving and the feel-good factor has grown. We are expanding our business and hiring at least 10 people to track more sectors and companies. We are also expanding our capacity to meet the needs of a bull market."

Other broking firms echo the view. "We are going in for a fresh drive to hire people for a bull market, to track more sectors and companies," Paresh Khandwala, managing director of Khandwala Securities, said.

All this comes after almost two years of extreme downsizing and consolidation in the stockbroking industry. Industry watchers, however, warn that it may be too early to pop the champagne corks because people are being recruited to fill the gaps created by the retrenchments of the past two years.

The stock market peaked in February 2000, when the BSE Sensex pierced the 6,000 mark. After that, it went downhill till the recent revival. The current surge in the Sensex has provided a fresh lease of life to market intermediaries.

The markets seem to have revitalised broking houses. Business seems to be up for most of them, and expansion plans are not just being discussed but implemented. The emphasis is not only on business but also on customer service and relations.

Jaideep Arora, director of Sharekhan, said: "We have 28 branches and plan to add another 10 by the year-end. We have been recruiting people. The plan is to add at least 50 employees at different levels and functions. Business has increased considerably over the past year. Today our online and offline businesses have a combined average daily turnover of more than Rs 300 crore (Rs 3 billion), against about Rs 200 crore (Rs 2 billion) last year."

Indiabulls has added almost 100 people in the past three months, and is looking to expand its network from 36 branches to about 50 soon. Its chief marketing officer, Gagan Banga, said, "The turnover has increased from Rs 160-170 crore (Rs 1.60-1.70 billion) about six months ago to around Rs 315 crore (Rs 3.15 billion) today."