Groww set to outpace Zerodha in active client count soon

For long, Zerodha has been the undisputed king of India’s stockbroking ecosystem. But now, as per media reports, its rival financial services platform Groww is set to outdo Zerodha soon, in terms of active clients. 

According to reports, Zerodha added 33,000 new users in July, and about 88,000 in August. In contrast, Groww saw 2.5 lakh new users joining the platform last month. Industry sources note that Groww, which began operations in 2017, currently has around 62 lakh active users, will soon upend Zerodha, which has approximately 63 lakh active users. The two of them are trailed by Angel One, which added 46 lakh new clients in August, 2023. 

The exact number of new users added by all platforms during September will be known only next month, once both companies file disclosures with NSE. However, simply taking the number of clients active on a platform is an inadequate indicator of its popularity. According to NSE, any client who makes at least 1 trade during a financial year is termed as an active client. 

Trading activity saw a massive spike during the last few years, when India was under lockdown, battling Covid-19. 

Table 1 : Number of active clients 

Slow and steady 

In a recent X (formerly Twitter) post, Zerodha co-founder Nithin Kamath chronicled Zerodha’s journey, noting that while it took them six years to reach their first 60,000 customers, they managed to acquire the next one crore users within the next 6 years. 

In contrast, Groww, which forayed into stockbroking in 2020, even outdid NSE in terms of  actively building its user base. Between FY21 and FY22, Groww saw its active client base on NSE grow by a whopping 31.5%. During the same time, Zerodha’s user base on NSE rose by a paltry 6.45%. 

However, when it comes to profitability, Zerodha far outshines Groww. In FY22, Zerodha raked in Rs 2,094 crores in profit, registering an 87% y-o-y growth. During the same period, Groww incurred losses of about Rs 239 crore. Both of these platforms are soon set to lock horns in the mutual fund space as well. 

This month, Groww received SEBIs nod to launch its first index fund, named Groww Nifty Total Market Index Fund. The move came weeks after competitor Zerodha got SEBIs green signal in August to step into the asset management space. It has already filed draft documents to launch two funds, namely the Zerodha Tax Saver (ELSS) fund and the Zerodha Nifty Large Mid Cap 250 Index Fund. Both of these funds will have Nifty’s Large Mid Cap 250 Index as their benchmark.