Motilal Oswal initiated coverage on Billionbrains Garage Ventures (Groww) with a ‘Buy’ rating, projecting a target price of Rs 185 for the next 12 months. This implied an upside potential of 19% from the current market price.
Market leadership and rapid scaling
Groww has emerged as the largest retail broking platform in India based on NSE active clients in just four years of its launch. The company commanded 26.8% market share as of November 2025, which is approximately 9% higher than its closest competitor. This rapid scaling is highlighted by a 3-fold revenue surge between FY23 and FY25, with expectations that revenue will double again over the FY25–28 period.
Diversification through optional growth levers
Groww has evolved into a full-stack investment platform from being a niche mutual fund platform. The company is actively building new revenue streams to reduce its dependence on the volatile broking segment, which is expected to drop from 85% of revenue in FY25 to 67% by FY28. These growth levers include:
- Margin Trading Facility (MTF): This category is expected to grow its contribution in revenue by 12% by FY28 from 1% in FY25.
- Credit Products: Leveraging its $30 billion in platform assets to offer Loans against Securities (LAS) and Loans against Mutual Funds (LAMF).
- Wealth Management: Targeting its growing affluent customer base through the acquisition of Fisdom.
Motilal Oswal on Groww: High organic growth and low acquisition costs
Groww maintains a highly efficient customer acquisition model, with over 80% of its customers acquired organically. This keeps the Cost of Acquisition (CAC) low, between $6 and $10. This organic funnel was built on the trust established as a zero-commission mutual fund platform.
Motilal Oswal on Groww: Robust in-house technology
The company utilises a fully in-house tech stack, which lowers the cost of technology while allowing for rapid feature deployment and high platform uptime. A significant portion of Groww’s costs (approximately 90-91%) is fixed in nature. As incremental revenue scales across new business lines, while fixed costs remain stable. Thus, Motilal Oswal expects the company’s EBITDA margin to expand to 66.4% by FY28.
Groww’s stock performance
The stock price of Groww has moved up 5% in the last five trading sessions. It has given a return of 7.4% in the previous one month and 24% since it started trading on the exchanges.