Groww grabs market share from rival discount brokers, traditional platforms

The total number of active investors on NSE jumped about 25 percent on-year to 40.8 million at the end of FY24.

Groww has grabbed a bigger slice of the market pie to command nearly a quarter of active investors on the NSE as most of its peer stock brokers either grew slower or suffered a churn in customer base.

A few brokers such as Zerodha and HDFC Securities have seen a loss in market share despite a growing customer base, while others such as Upstox and ICICI Securities have recorded an erosion in users.

Groww’s active investor base swelled to 9.5 million active investors in March 2024, up 77.5 percent from a year ago, according to NSE data. Its market share has expanded to 23.4 percent, from 16.5 percent last year.

Angel One too has also seen an expansion in its market share to 15 percent, with an active investors base of 6.11 million at the end of FY24 - a growth of 42 percent on-year.

Small cities fuel big draw in investors 

India has seen a rise of investors, specially from smaller cities and towns, increasingly signing up with discount brokers due to cost-effectiveness and easy-to-use mobile apps. The total number of active investors on the NSE jumped about 25 percent on-year to 40.8 million at the end of FY24.

However, the brokerages that grew their customer base, but lost the market share to Groww and Angel One in financial year 2023-24 include Zerodha, Motilal Oswal, HDFC Securities, SBICap Securities and Axis Securities.

On the other hand, a few brokerages saw an erosion in the customer base, including Upstox, 5Paisa Capital, ICICI Securities, Sharekhan and IIFL Securities. ICICI Securities and Upstox were the biggest market share losers at more than 260 basis points each. It’s telling that Groww’s customer base is more than five times that of ICICI Securities.

‘Groww’th trajectory

Earlier, in September 2023, Groww overtook Zerodha as the largest stock broking platform. Zerodha's user base has doubled to 3.4 million in March 2021. On the other hand, Groww's customer base ballooned over 12 times from 0.78 million.

Interestingly, Zerodha’s revenue is more than five times that of Groww. During FY 23,  Zerodha reported a 39 percent growth in revenue at Rs 6,875 crore compared with the previous financial year. It also reported an identical growth in profits, which stood at Rs 2,907 crore during the last fiscal.

Read: The F&O edge: Why Zerodha will sit pretty at top

Nextbillion Technology Pvt Ltd, which runs Groww, has recorded a revenue of Rs 1,294 crore in FY23, more than three-fold growth from FY22. It reported a net profit of Rs 73 crore.

The sizable difference in revenue and net income is mostly due to Zerodha’s dominance in the Futures & Options trading, a high income generating and profitable segment. Groww started as a platform that focussed on attracting new customers with long-term investment products and mutual funds, especially systematic investment plans (SIPs) and then moved on to direct equity investment on its broking platform. However, the company is now trying to attract daily as well as F&O traders over the last couple of years.

(With inputs from Anand J and Shaleen Agrawal)

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