Athira Sethu
11 November 2024
In October, India’s leading online brokerage, Groww, continued to widen its lead over competitors, even as the market dropped more than 6%, the worst month for the stock market since the Covid crash of 2020. New users continued to trickle in, even amid the slide. This did not stop new investors from signing up. Groww, the Bengaluru-headquartered wealth management startup, added around 3.5 lakh new users to its coffers during the month. With this, the active traders of the exchange crossed over 1.25 crore, according to the NSE data.
Groww‘s nearest rival, Zerodha, has around 80 lakh investors. Now, the gap has risen to 45 lakh. Last year, Groww took the lead as the country’s largest broker when both used to have around 64 lakh users. In the last year, Groww has almost doubled its user base, adding around 5 lakh new users monthly. Meanwhile, Zerodha added only 15 lakh new users in the same period or about 1.25 lakh per month.
Angel One, the third-largest brokerage added nearly 25 lakh new users during the recent calendar year – that is, around 2.5 lakh a month. It is trailing Zerodha by just about 5 lakh users and may soon overtake the latter.
Despite the downtrend in the market during October, the inflow of new investors into the market was still healthy. Though the count of new users is not stable, most large brokers have managed to add nearly the same number of users as they did in September. However, some of the major discount brokers have witnessed a 20-30% drop in new users but are growing on a much larger base.
Upstox tumbled to fourth place, but its growth did not sag and active investors could grow from 21.5 lakh in the last year to 28.5 lakh in October. Dhan is the newcomer that bumped Paytm Money from the top 10 brokers list; it added more than 50,000 new investors, the highest after the top three.
In terms of revenue, Zerodha is still way ahead of Groww. Zerodha’s earnings for the financial year 2024 stand at Rs 8,320 crore. By contrast, Groww’s revenue stands at Rs 2,900 crore. In preparation for future challenges, including higher taxes on trading, lower exchange rebates, and curbs on retail trading in futures and options, certain brokers might see a fall of up to 50% in their revenue in the second half of 2025, estimates experts.
As of today, over 160 million demat accounts exist in India. However, the active investors base remains only around 50 million. Despite all these challenges, the number of new investors continues to rise, suggesting that interest in the stock market still prevails.
