PremiumThe profit grew 87% over the previous year, according to its filings with the Registrar of Companies (RoC) accessed by data intelligence platform Tofler.
India’s largest stock broking platform, the Bengaluru-based unicorn Zerodha posted a profit of ₹2,094.4 crore for the financial year(FY) 2022, at a time when most Indian startups are struggling to reach profitability.
The profit grew 87% over the previous year, according to its filings with the Registrar of Companies (RoC) accessed by data intelligence platform Tofler.
The unicorn provides share broking, financial and portfolio management consultancy services. It was founded by Nithin and Nikhil Kamath in 2010.
The company reported an operating revenue of ₹4,963.7 crore in FY22, up 82% over last year. All of this was through sale of its services, for which it charges a small fee. However, chief executive Nithin Kamath had warned of the slowdown in the industry in an update last month. “We have already seen an almost 50% fall in monthly new account openings from January this year, and this trend has been similar across the industry," he said.
Co-founder Nikhil Kamath also said in an earlier interaction with VCCircle that investors across the board must be “circumspect" with their trades in the current market.
“While we are on track to do as much revenue and profits as last year, even this year, we think we will be unable to match the current revenues and profitability from the next financial year for a few more years," Nithin said in the note.
In FY22, the company’s expenses also grew by 72% to ₹2,164.1 crore, as compared to ₹1,260.2 crore in FY21.
Its employee benefit expense grew 45% to ₹459 crore. A large part of this was other expenses that grew 82% to ₹1,686.5 crore during the year, which included an information technology expense of ₹303.1 crore and miscellaneous expenses of ₹1,342.4 crore. The note further said that the industry has “temporarily hit a plateau in terms of the target market, customers who have sufficient savings to invest in the market."
“The business will also most likely get impacted due to the changing regulatory landscape, where, among many things, the working capital requirements are going up quickly," it said.
The stock broking platform claims to process orders for over 10 million clients daily. As per its website, transactions on the stock broking platform account for about 15% of the total retail trading volumes in India. The platform’s products are divided into investments and technology offerings.
Among other trading platforms operating in India, Groww posted over 2.5x growth in its FY22 net profit at ₹6.8 crore from its earlier ₹2.6 crore net profit. The online trading platform’s revenue from operations widened about 8x to ₹348 crore in FY22, against ₹40.5 crore in FY21.
Its overall expenses in the given fiscal were 775% higher year-on-year at ₹359.4 crore, with a significant rise seen in its IT expense, which soared to ₹145.5 crore in FY22 from ₹16.87 crore in FY21.