Bengaluru-based fintech unicorn Groww has turned profitable in FY23 posting a net profit of ₹448.7 Cr as compared to a net loss of ₹239 Cr in the previous fiscal. The broking and financial services company’s revenue from operations surged 266%YoY to ₹1,277.8 Cr from ₹351 Cr in FY22.
In FY23, Groww’s total expenses increased 41% YoY to ₹932.9 Cr as against an expense of ₹663.6 Cr in FY22. The start-up’s employee benefit expenses increased 25% to ₹287 Cr from ₹230 Cr in FY22. Its total income was around ₹1,427 Cr. The company earned ₹4.8 Cr from tech platform and support charges, as compared to ₹23.6 Cr last year.
According to a report, Groww’s broking business alone posted a profit of ₹73 Cr vs ₹6.8 Cr it had registered in the previous financial year.
Groww was founded in 2017 by former FlipKart employees Harsh Jain, Lalit Keshre, Neeraj Singh, and Ishan Bansal as a direct mutual fund distribution company. Over the years, it has diversified its business allowing users to invest in stocks, exchange-traded funds (ETFs), and IPOs. In FY23, Groww expanded its offerings by rolling out payments through its app and also ventured into credit distribution.
Last year, Microsoft CEO Satya Nadella became an investor and advisor for the company. Across two funding rounds in 2021, its valuation increased to $3 billion led by investments from ICONIQ Growth, Alkeon, Lone Pine Capital, Steadfast and Sequoia Capital among others.
Recently it was reported that the firm had applied for a ‘corporate agent’ insurance license from the Insurance Regulatory and Development Authority of India (IRDAI), which would allow it to partner with only three insurance companies per category .
Zerodha, Groww’s direct competition in broking business reported a 39% growth in revenue at ₹6,875 Cr in FY23 compared to last year. It reported a net profit of ₹2,907 crore during the last fiscal. In FY22, Zerodha had posted revenue growth of 38.5% to ₹4,964 Cr and a net profit of ₹2,094 Cr, 39% jump YoY.
Earlier this month, Groww nudged past its rival Zerodha to become the country’s largest broker in terms of the number of active investors.The platform had 6.63 million active investors as compared Zerodha’s 6.48 million at the end of September 2023. The total market share of Groww stood at 20.35%, closely followed by Zerodha at 19.9 per cent. Groww has witnessed phenomenal growth from 0.78 million users in FY21 to 3.85 million in FY22 to 5.78 million in FY23. Despite this growth, Zerodha’s revenue is more than five times that of Groww.