India’s largest stock broking platform Zerodha posted a profit surged past Rs 2,000 crore in FY22, at a time when most Indian startups are struggling to attain profitability.
According to the data intelligence platform Tofler’s access to the bootstrapped company’s filings with the Registrar of Companies (RoC) and its profit of Rs 2,094.4 crore, the profit increased 87% from the previous year.
The unicorn, based in Bengaluru, offers portfolio management consulting, financial services, and share broking. In 2010, Nithin and Nikhil Kamath established it.
In FY22, the business reported operating revenue of Rs 4,963.7 crore, an 82% increase from the previous year. It made all of this possible by selling services for a small fee.
However, in a recent update, CEO Nithin Kamath expressed concern about the industry’s slowdown.
He stated, “From January this year, we have already seen an almost 50% fall in monthly new account openings, and this trend has been similar across the industry.”
In his conversation with press, Co-Founder Nikhil Kamath also stated that investors must be “circumspect” with their trades in the current market. “We think we will be unable to match the current revenues and profitability from the next financial year for a few more years,” Nithin added in the note, “even though we are on track to do as much revenue and profits as last year, even this year.”
In comparison to Rs 1,260.2 crore in FY21, the company’s expenses increased by 72% in FY22 to Rs 2,164.1 crore, in line with company expenses.
It spent Rs 459 crore on employee benefits, up 45 percent. Other expenses, which increased 82% to Rs 1,686.5 crore over the course of the year and included an Information Technology expense of Rs 303.1 crore and miscellaneous expenses of Rs 1,342.4 crore, accounted for the majority of this.
The industry has also “temporarily hit a plateau in terms of the target market, customers who have sufficient savings to invest in the market,” according to the note. “The business will also most likely get impacted due to the changing regulatory landscape, where, among many things, the working capital requirements are going up quickly.”
The stock brokerage platform that is run by the Kamath brothers claims to process orders on a daily basis for more than one crore clients. According to the stock broking platform’s website, approximately 15% of India’s retail trading volume is accounted for by transactions on the platform. Investments and technology offerings make up the platform’s offerings.
It makes it possible for retail investors to trade in a variety of asset classes, such as stocks, mutual funds, futures and options, fixed income products that let investors invest in sovereign gold bonds or government-backed securities, and initial public offerings (IPOs). In addition to allowing trading with its partner platforms such as Smallcase, Streak, Sensibull, GoldenPi, and Ditto, some of its most important tech offerings provide trading platforms for a variety of use cases.
In comparison to other Indian trading platforms, Groww’s FY22 net profit, which was Rs 2.6 crore, increased by more than 2.5 times. The revenue from operations of the online trading platform increased by approximately 8 times to Rs 348 crore in FY22, from Rs 40.5 crore in FY21.
Its overall expenses in the given fiscal were 775% higher year-on-year at Rs 359.4 crore, with a significant rise seen in its IT expense, which soared to Rs 145.5 crore in FY22 from Rs 16.87 crore in FY21.
