Groww secures Sebi nod for up to $1 billion IPO amid headwinds in retail trading

Stock-broking app Groww has received the market regulator’s approval to raise $800 million to $1 billion in an initial public offering of shares, two people said. The Bengaluru-based investment platform had filed a confidential draft red herring prospectus with the Securities and Exchange Board of India on 26 May for its IPO. Groww did not immediately comment on Sebi’s approval for its IPO. Its parent company Billionbrains Garage Ventures Pvt. Ltd has appointed JPMorgan Chase & Co. and Kotak Mahindra Bank Ltd as the bankers for its initial public offering. The fintech startup’s IPO plans come amid a broader slowdown for India’s leading discount brokerages—Groww, Zerodha, Angel One, and Upstox—which together lost nearly 2 million active investors in the first half of 2025, according to NSE data. June alone witnessed a net withdrawal of 600,000 clients from these platforms, underscoring a difficult six-month stretch shaped by regulatory headwinds and waning retail participation. Since January, Groww has shed 600,000 clients, while market leader Zerodha saw 550,000 users exit. Angel One and Upstox also reported declines, losing 450,000 and just over 300,000 clients, respectively. This decline has coincided with a drop in retail interest in the derivatives market following Sebi’s curbs on trading in futures and options. Stricter margin rules, shorter contract expiries, tighter eligibility requirements, and higher taxes have collectively shifted the landscape away from casual traders. “The tighter F&O norms will have some impact on trading volumes in the near term, but this is an industry-wide adjustment, not limited to a company,” said Kranthi Bathini, director at WealthMills Securities. “Historically, retail volumes shrink during volatile phases, but today’s digital-first ecosystem and the broader financialization of assets suggest activity will strengthen again over time,” he added. Trading headwinds Retail investors—often more sensitive to short-term gains and market stability—are beginning to pull back after an extended spell of speculative activity. India’s post-covid market rally had attracted millions of new individual investors, many enticed by the prospect of fast profits. But with stricter regulations, volatile expiry sessions, and muted near-term returns, a portion of this investor base seems to be stepping aside, at least temporarily. “The slowdown is a short-term phenomenon. Retail activity always dips during periods of volatility and uncertainty, and fresh account openings also tend to decline,” said Bathini. “But if you look at the past five years, the growth has been phenomenal, with ample opportunities ahead as equity penetration in urban and semi-urban India is still at a very early stage.” In June, Groww completed raising $200 million at a $7 billion valuation, with investments from Singapore’s sovereign wealth fund GIC and existing backer Iconiq Capital. Earlier, Viggo Investment Pte., GIC’s investment arm, had sought approval from the Competition Commission of India to acquire a 2.143% stake in Groww. Groww’s institutional investors include Y Combinator, Tiger Global, Ribbit Capital, and Peak XV Partners, while its angel investors feature Microsoft chief executive Satya Nadella and Myntra co-founder Mukesh Bansal.