Groww IPO: Apply or avoid?

Summary: Groww, a reputed digital investment platform, is set to go public on November 4, 2025. We analyse its strengths, weaknesses and past financials to help you decide whether its IPO is worth subscribing to.

Groww (Billionbrains Garage Ventures), a digital investment platform, will open its IPO (initial public offering) on November 4, 2025 and close on November 7, 2025. Of the total issue size of Rs 6,632 crore, the company aims to raise around Rs 1,060 crore via a fresh issue, while the remaining Rs 5,572 crore will be raised via an offer for sale (OFS).

Here, we break down Groww’s business, financials, strengths, risks and valuation to help you make an informed investing decision.

What the company does

Groww is a direct-to-customer digital platform that simplifies investing and wealth creation. It allows users to invest and trade in stocks, IPOs, derivatives, bonds and mutual funds, including its own fund house, Groww Mutual Fund. The platform also offers margin trading and personal loans. As of June 2025, it was India’s largest and fastest-growing investment platform, based on the number of active NSE users.

Track record and valuation

A quick glance at Groww’s financials shows that the company has been on a strong footing. During the three-year period (FY23-25), the platform posted a double-digit annual growth in its revenue at 85 per cent. Net income (profit after tax) and earnings before interest and tax (EBIT) grew as well, at nearly 100 per cent and 146 per cent, respectively.

At the upper end of the price band (Rs 100), Groww’s stock is expected to be valued at over 33 times its TTM (trailing twelve months) earnings and 8.8 times its book value. By contrast, its peers trade at a median P/E of 29 times and an average P/B of 7 times.

The good

Here are some of Groww’s positives.

#1 Established player in the digital investing arena

Groww has emerged as one of India’s most trusted names in retail investing, with a strong presence across cities, towns, and villages. Between FY22 and June 2025, it captured over 38 per cent of new app downloads among the top five brokers. Notably, over 80 per cent of its users are acquired organically, helping keep acquisition costs low. As of June 2025, Groww had active users in 98 per cent of India’s pin codes.

In addition, Groww has a high customer retention rate, as 77.7 per cent of its users who joined three years ago remain active, with first-quarter retention consistently above 84 per cent across cohorts since FY22.

#2 Capital-efficient and asset-light model

Groww’s business model rests on three pillars: customer focus, technology and an asset-light structure. Putting customers first has helped drive engagement, retention and adoption across products, boosting revenue per user at low cost. While a technology-led approach has improved operating leverage and enabled revenue to scale efficiently, operating costs fell from 26.3 per cent of revenue in FY23 to 13.8 per cent in FY25.

The bad

Although Groww enjoys a significant market share and high profitability, it grapples with certain risks.

#1 Revenue highly dependent on brokerage services

Groww remains heavily dependent on its broking business, which contributed 84.5 per cent of operating revenue in FY25 and 79.5 per cent for the quarter ended June 2025. Thus, any decline in customer activity or demand for broking services could materially affect its revenue, profitability and cash flows.

#2 Operates in a highly competitive market

Though Groww is one of the largest and well-known players in the digital investing space, it faces stiff competition from both large and lesser-known platforms, primarily due to the industry’s low entry barriers. This can lead to a decline in Groww’s market share, in turn, affecting its revenue and profitability.

Where will the IPO proceeds go?

Below is a breakdown of how Groww plans to utilise its fresh issue of Rs 1,060 crore:

• Around Rs 153 crore will be used for cloud infrastructure spends
• Rs 225 crore for brand building and marketing-related activities
• Rs 205 crore will be invested in GCS, one of its subsidiaries, for expanding its capital base
• Nearly Rs 168 crore has been earmarked for investment in GIT, another subsidiary, for funding its MTF (margin trading facility) business

The remaining funds, if any, will be directed towards inorganic growth and general corporate purposes.

So, should you apply to the Groww IPO?

The Groww IPO may be one of the most-awaited listings this year and is likely to grab plenty of market attention. But remember, headlines don’t build wealth; discipline does. True success comes from patience and steady compounding, not chasing every new opportunity.

Value Research Stock Advisor helps you cut through the noise and focus on quality businesses that grow steadily over time, so your money keeps compounding long after the IPO frenzy fades.

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Also read: Lenskart IPO: Should you apply?