Bengaluru-based Groww, now the largest stock broking firm in India by active investors, has just reported an impressive financial performance for the fiscal year ending March 2024. The company’s revenue more than doubled to ₹2,900 crore, up from ₹1,295 crore in the previous year. Its net profit also saw a significant leap, soaring to ₹298 crore from just ₹73 crore in FY23.
This growth reflects the success of Groww Invest Tech Private Limited (GIT), the subsidiary that handles its broking operations. The firm has been on a roll, boasting nearly 1.2 crore active investors as of August, surpassing its rival Zerodha, which reported revenue of ₹8,320 crore and a net profit of ₹4,700 crore with about 79 lakh active users.
Despite this success, the future isn’t without challenges. ICRA, the rating agency, warns that the stock broking industry may face hurdles like higher taxes, lower exchange rebates, and possible restrictions on retail trading in the upcoming financial year. They predict that many broking firms could see a 30-50% drop in revenue during the latter half of FY25.
GIT’s financial health heavily depends on the volatile capital markets, especially since around 75-80% of its net operating income comes from futures and options trading. Additionally, any changes in regulations or technology could impact its operations.
In a recent milestone, Groww also celebrated reaching over 10 million active traders on its platform, a significant achievement in a market where India has more than 160 million demat accounts—though only about 50 million are active investors.