Groww is strategically shifting from its core brokerage model to a broader financial ecosystem, using newer products like margin trading and derivatives to challenge established players like Zerodha.
Groww is trying to prove that it can become more than a brokerage app. The company, which began as a mutual fund platform in 2017, has built one of India’s largest retail investing ecosystems and now wants its newer lines of business to matter as much as its core trading franchise. That ambition has sharpened as its closest rival, Zerodha, still generates far more revenue and profit, even though Groww now has the larger active client base.
The comparison with Zerodha frames the challenge. Moneycontrol said Zerodha’s revenue and profit were broadly flat in FY26 at about ₹8,847 crore and ₹4,283 crore, while The Economic Times reported that margin trading helped cushion its slower broking business. Groww, by contrast, has been expanding faster, with operating revenue rising 19% to ₹4,644.6 crore and net profit up 14% to ₹2,083 crore in FY26, even as tighter rules on futures and options and higher taxes weighed on the sector. Livemint has also reported that Groww’s average revenue per user remains low by industry standards, reflecting a younger customer base that trades less heavily than the client sets of more mature rivals.
That makes diversification central to the next stage of its growth. Inc42’s analysis of Groww’s recent filings shows the company is reducing its dependence on stockbroking and equity derivatives, even as both remain larger in absolute terms. In Q1 FY26, stocks and equity derivatives made up 75.7% of total income; by Q1 FY27, that share had fallen to 68.4%. The shift does not mean the old businesses are shrinking. It means newer products are growing faster, slowly changing the shape of the company’s revenue mix.
Some of those newer businesses are still too small to move the needle in the near term. Direct mutual fund distribution is mainly a customer-acquisition tool, while Groww’s asset management arm and wealth products such as W and MF Prime are still building scale. The company has also spent heavily to expand its product stack, acquiring Indiabulls’ asset management business in 2023 and Fisdom in 2025, while preparing a relaunch of US stock investing through GIFT City. Yet, as Inc42 noted, the commercial impact of those moves has not arrived at the same pace as the product launches.
The clearest near-term opportunity appears to be margin trading facility, or MTF, where customers borrow from the broker to buy shares. Inc42 reported that MTF’s share of Groww’s total income rose from 3% to 8% between Q1 FY26 and Q1 FY27, while the funded book jumped 264% to ₹3,775 crore. Commodity derivatives are also scaling quickly, helped by Groww’s late-2025 launch into the segment. The company said in its shareholder materials that it is still early in that journey, but the category already contributed nearly 5% of total income in Q1 FY27.
Credit is a longer-term play. Loans against securities and personal loans accounted for 5.5% of total income in Q1 FY27, according to Inc42, with the business still in a gestation phase. Groww’s CFO, Ishan Bansal, said on the company’s earnings call that Fisdom had yet to show a meaningful lift in revenue, while co-founder Lalit Keshre said loans against securities were becoming a larger part of disbursements. The company is betting that these higher-value services, together with asset management and wealth advisory, can help it narrow the gap with Zerodha without breaking the low-cost model that made its broking business successful in the first place.
That is still a difficult balancing act. Groww’s own history shows how quickly regulatory, tax and execution risks can affect the numbers, from its one-time US tax charge in FY24 to a trading outage in 2024 that led to a Securities and Exchange Board of India settlement. For now, the company’s newer products are improving the mix, but not yet enough to replace the scale of brokerage income. The real test is whether Groww can turn a wider menu of financial products into durable, high-margin revenue before the market’s expectations move on again.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
