Billionbrains Garage Ventures Ltd (Groww) shares jumped over 10% on Tuesday during trading hours, hitting a new high of ₹216.75 apiece. Investors seem excited about better revenue growth prospects for FY27, aided by a slightly softer base. Groww’s FY26 consolidated revenue grew by 19% year-on-year to ₹4,644 crore, and net profit was up 14% to ₹2,083 crore.
After Q4FY26’s encouraging results, announced on Monday, some analysts have raised their FY27 and FY28 earnings-per-share estimates a tad. Aided by higher MTF (margin trading facility) and commodity derivatives revenues that are relatively newer product segments, Groww’s Q4 net profit increased 25% quarter-on-quarter to ₹686 crore, beating estimates.
Operating revenue grew at a similar pace, up 24% on-quarter to ₹1,505 crore. Broking revenue rose 20% on-quarter to ₹1,150 crore, led by strong order volumes. On-quarter order volume growth of 24% was at a multi-quarter high, up from 14% in Q3 and 10% in Q2. However, revenue per order fell to ₹19.5 in the last quarter from ₹20.1 in Q3 owing to lower F&O volume.
Groww expects its wealth management business Fisdom, acquired in October, to break even in FY28, while the asset management business will take longer.
Broking boost
For more than a year now, the Indian broking industry has been dealing with headwinds from Sebi’s regulatory changes in F&O and subdued equity markets. “Over this period, Groww has shown more resilience, greater ability to cross-sell and better profitability relative to peer, Angel One,” said Jefferies India’s analysts, adding that Groww's cash orders have grown sequentially for two quarters, while option orders in the last two quarters were higher than Q3FY25.
“In contrast, Angel One's cash orders continue to fall, and option orders have just recovered to pre-regulatory change levels,” reckons Jefferies.
Superior metrics and earnings growth have helped Groww’s shares command a premium; based on Bloomberg consensus estimates, Groww’s shares trade at 44x FY27 earnings versus Angel’s 23x. The Groww stock has more than doubled from its issue price of ₹100 in November, suggesting investors are adequately factoring in the brighter picture for now.
JM Financial Institutional Securities believes Groww’s valuations remain ahead of meaningful traction in recurring revenue. The broking firm expects as much as 87/86% of Groww’s income to come from broking (and allied streams, such as MTF and float) in FY27/FY28, down from 88% in FY26. Thus, how Groww’s new segments scale up is worth tracking ahead.