Groww IPO likely in 2025: India’s largest retail broker set for billion-dollar issue – ‘Must know’ investor insights

Billionbrains Garage Ventures, the parent firm of Groww, which was incorporated in January 2018, will be mopping up funds from the Indian markets through an initial public offer. The timeline for the same is not clear yet, but the market regulator, SEBI, has approved the IPO. Though the exact issue size and price bank are yet to be finalised, this IPO is likely to be one of the largest fintech offerings in the country and is expected to raise $700 million – 1 billion from the issue. The company is valued at $7 -8 billion.  

Groww IPO: Understanding the business

Groww is an online stock broking firm that provides services such as buying and selling stocks. Along with that, customers can bid for IPOs. The other financial products include derivatives, bonds, mutual funds (including Groww Mutual Fund), and personal loans. 

In business terms, the company is described as a direct-to-customer digital investment platform. As per the company, Groww’s mission is to empower customers with transparency, simplicity, and speed in their wealth journey, which it wants to achieve through customer-friendly design and an in-house technology platform.

According to the Redseer Report, Groww was India’s largest and fastest-growing investment platform by active users on NSE as of June 2025. This has been shared by Groww in its DRHP. As of June 2025, Groww had 12.6 million active clients on NSE.

Groww IPO: IPO details

As per the updated DRHP, the Groww IPO is a 100% book-built issue that consists of both a fresh issue and an offer for sale (OFS). The fresh issue size is 10,600 crore shares, while the OFS comprises the sale of 57.42 crore shares. 

Groww IPO: Promoters selling shareholders

The offer for sale involves both the promoter selling shareholders and other selling shareholders. The promoters of the company are Lalit Keshre, Harsh Jain, Ishan Bansal, and Neeraj Singh. They are selling 10 lakh equity shares each.

Groww IPO: Major investors selling shareholders

That apart, key stakeholders selling stake include, 

• Peak XV Partners Investments VI-1: Up to 15.83 crore equity shares.
• YC Holdings II, LLC: Up to 10.55 crore equity shares.
• Ribbit Capital V, L.P.: Up to 6.57 crore equity shares.
• Internet Fund VI Pte. Ltd.: Up to 6.48 crore equity shares.
• GW-E Ribbit Opportunity V, LLC: Up to 5.25 crore equity shares.

Groww IPO: Objectives of fresh issue

The net proceeds from the fresh issue are proposed to be utilised for a host of objectives. Rs 152.5 crore will be used towards building cloud infrastructure. The company will use Rs 225 crore for brand building and marketing activities. 

The company will allocate Rs  205 crore for investment in material subsidiary, Groww Creditserv Technology (GCS), an NBFC, for augmenting its capital base. The remaining Rs 167.5 crore will be invested in another subsidiary, Groww Invest Tech (GIT), for funding the Margin Trading Facility (MTF) business.

Groww IPO: Key limits on use of proceeds

However, the amount utilised for funding inorganic growth through unidentified acquisitions and general corporate purposes shall not exceed 35%. Furthermore, the amount utilised for each of these two sub-categories (unidentified acquisitions and general corporate purposes) shall not exceed 25% of the gross proceeds.

Groww IPO: Lead managers and registrar

The book running lead managers (BRLMs) are a consortium of major financial institutions, which are Kotak Mahindra Capital Company, J.P. Morgan India, Citigroup Global Markets India, Axis Capital, and Motilal Oswal Investment Advisors. The registrar of the issue is MUFG Intime India (formerly Link Intime India).

Groww IPO: Overview of competition from peers

India’s investment market comprises three main types of players:

1. Digital-first platforms like Groww, Zerodha, Angel One

2. Bank-led brokers such as ICICI Securities, Kotak Securities, HDFC Securities, SBICap Securities, etc.

3. Wealth management players, which include the likes of 360 One, Nuvama Wealth, Motilal Oswal, Prudent Corporate Advisory, and many others.

Traditional brokerage houses and banking institutions have accelerated the transformation of their products and services, focusing on competitive pricing, improved experience, and offering integrated saving-investment-wealth management platforms.

Groww IPO: Key risks to watch out for

The company has highlighted a few risks that may concern investors before placing bids for the IPO. 

1. Working capital risk: The company is exposed to working capital risks. That too, particularly during periods of increased customer activity and market volatility. The time lag between customer fund transfer and full settlement, along with increased margin requirements from exchanges, raises the risk of failing to arrange adequate working capital.

2. Managing employee expenses: The company incurred a loss of Rs 805.45 crore in FY24, and the reason was a large one-time performance-based incentive paid to the management. 

The amount given to the management was Rs 778.6 crore. This amount contributed significantly to the increase in the company’s employee benefits expense in FY24.

The management didn’t stop there. In addition to the one-time performance-based incentive, the company came up with a long-term incentive plan for the four whole-time directors. 

The company was scheduled to accrue Rs 106.17 crore during the year ended FY24 and Rs 159.25 crore during the three months ended June 30, 2024. However, this long-term incentive plan was cancelled.

3. Technical glitches: Groww has occasionally faced instances of technical anomalies and technology downtime in the past (e.g., login issues, payment delays, or firewall failure at a third-party vendor site).

4. Market volatility and geopolitical risks: The investing, saving, and spending trends are closely tied to the macro-economic environment and global headwinds, equity market performance, and geopolitical risks. This can impact transactions during specific events.  

5. Regulatory changes: Similarly, regulatory changes, such as the new framework for derivatives and the ‘Charges levied by Market Infrastructure Institutions – True to Label’ circular introduced by SEBI in 2024, can adversely affect the business, prospects, and results of operations by impacting fees, commission income, and trading volumes.

6. Cybersecurity vulnerabilities: Rapid digitisation has raised vulnerabilities to cyber threats, data breaches, and system failures. Integrations with third-party vendors and market intermediaries further increase these cybersecurity supply chain risks, which brings us to the next point of risks involved. 

Moreover, this is a business that is closely dependent on third-party service providers for payment infrastructure, software, order management systems, credit data, and other similar operations. Disruption or failure by these third parties could interrupt operations and even customer losses.