Groww is India’s No.1 stock broker, Zerodha loses Crown

[Pee Cee]

The ET pointed out that Zerodha, founded by billionaire brothers Nithin and Nikhil Kamath, has lost its status as India’s largest stock broking firm to another startup Groww.

The latest data from NSE’s active client base shows that the number of users on Groww rose to 66.3 lakh in September while Zerodha’s client list was at 64.2 lakh.

In August, Groww had 62 lakh active users on its platform as compared with 63 lakh for Zerodha.

Despite rising competition from newer entrants like Paytm Money, Upstox, blinkX, Dhan, and HDFC Sky, the discount broking space in India is largely concentrated in the hands of a few strong players.

Zerodha, which remains bootstraped, was so far the undisputed leader in the market and had clocked revenue of around Rs 6,875 crore in FY23 and a profit after tax of Rs 2,900 crore. The pioneer of the discount broking segment in India remains the largest brokerage by revenue and profitability numbers.

Zerodha says it is the only broker in the country to charge an account opening fee of Rs 200.

“While F&O contributes to revenue, we are most proud of the customer trust we have built, which shows in the total assets that customers have entrusted us with, which stands at approximately Rs 3 lakh crores today,” Zerodha CEO Nithin Kamath had said a fortnight ago, adding that the firm gets a bulk of its revenue from futures and options traders.

While some loss-making startups command crazy valuations from deep-pocketed VC investors, Zerodha has never raised capital from outside and still values itself at a modest Rs 30,000 crore by attributing a multiple of 10-15 times earnings.

Both Groww and Zerodha have entered the mutual funds business this year. While Zerodha has partnered with fintech smallcase to launch the AMC business, rival Groww acquired Indiabulls Asset Management earlier this year.

Started in 2016 by four ex-Flipkart employees – Lalit Keshre, Harsh Jain, Neeraj Singh, and Ishan Bansal, Groww was last valued at $3 billion and is backed by the likes of Sequoia Capital and Tiger Global.

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