Zerodha’s core brokerage revenue dropped 10.4% to ₹2,738 crore in FY26. This comes as rival Groww now boasts nearly twice as many active clients, putting pressure on Zerodha’s diversification strategy. While non-brokerage income held profits steady, its shrinking user base remains a structural challenge.
How We Got Here
Zerodha’s core brokerage business has faced headwinds since SEBI introduced its true-to-label norm for transaction charges and tighter RBI rules for currency F&O in 2024. These regulatory changes led to a 20-30% drop in F&O activity across exchanges and brokers, directly squeezing revenue streams.
The Numbers
- Net transaction charges, income earned from exchange-related fee rebates, fell to zero from ₹400 crore in FY25 due to SEBI’s norm.
- Zerodha’s overall topline remained flat in FY26 versus ₹8,847 crore a fiscal year ago, despite the core revenue decline.
- Profit rose marginally to ₹4,283 crore in FY26 from ₹4,231 crore in FY25, cushioned by non-brokerage income.
- Nearly 40% of Zerodha’s gross revenue in Q1 FY27 came from non-core businesses, including interest income, delayed payment charges, and MTF.
- In July, Groww added 70,119 active clients, reaching 13.12 million and 28.88% NSE market share, while Zerodha lost 38,725 clients, ending with 6.76 million and 14.88% share.
What Happens Next
🇮🇳 Why This Matters for India
For fintech founders and product managers in Bangalore and Mumbai, this story highlights how regulatory shifts and fierce competition are forcing even market leaders to reinvent their core business models.
The Take
The market will applaud Zerodha’s resilient profits, but the deeper issue is their inability to attract new-to-market users at scale, a battle Groww is winning decisively. Expect this user acquisition gap to become a central narrative for Zerodha in the next 12-18 months, overshadowing its current profitability metrics.
Source:
Inc42 ↗