Groww Seeks $200 Mn In Pre-IPO Funding Round

SUMMARY

Groww is in talks to raise the mega funding round from Tiger Global and GIC and will value the unicorn at around $6.5 Bn

The development comes at a time when the Tiger Global-backed startup is making advances towards making its initial public listing by the end of the fiscal year 2025-26

The Bengaluru-based startup reported net loss of of INR 805 Cr in FY24 against a a net profit of INR 448.7 Cr in the previous fiscal year

Investment tech unicorn Groww

is reportedly in advanced talks with Singapore sovereign wealth fund GIC and its existing backer Tiger Global to raise a mega funding ahead of its initial public offering (IPO).

An ET report said that the Bengaluru-based company is seeking to raise $200 Mn (around INR 1,700 Cr), a deal that could value it at around $6.5 Bn.

Groww has declined to comment on the Inc42’s queries related to the development.

Founded in 2017 by Lalit Keshre, Neeraj Singh and Ishan Bansal, Groww is an online discount broking platform that allows users to invest in stocks, exchange-traded funds (ETFs) and IPOs.

It counts Tiger Global, Peak XV, Propel Venture Partners, ICONIQ Growth and Y Combinator among its marquee backers.

Groww’s Run For IPO: The investment tech platform is pulling out all the stops to list on the Indian bourses. In January, reports surfaced that it was looking to file its draft red herring prospectus (DRHP) with market regulator SEBI by April-May for a $1 Bn IPO. Groww is said to be eyeing a listing by the end of the fiscal year 2025-26 (FY26).

Previous reports claimed that the fintech unicorn was targeting a valuation of $7 Bn to $8 Bn for its upcoming markets debut. In preparation for this, the company has picked banks, including JPMorgan Chase & Co. and Kotak Mahindra Bank to helm the public issue and shifted its domicile back to India.

Groww’s FY24 Ends In Red: The startup reported a net loss of INR 805 Cr in the financial year ending March 31, 2024 (FY24) against a net profit of INR 448.7 Cr in the previous fiscal year.

However, the startup maintained an operational profitability of INR 535 Cr for FY24. Its financial books ended in losses for the period under review primarily because of the hefty taxes it paid to the US government, for its domicile shifting which amounted to the tune of INR 1,340 Cr.

Groww’s Active User Base Slumped Due To Overall Market Correction: Amid the overall equity market correction in the month of January, the startup’s overall active user base slumped to 1.3 Cr from 1.32 Cr in the previous month. However it still maintained its position as a market leader in terms of the active user base in the industry.

In fact, all brokerages saw a decline in the number of active user base cumulatively falling to 4.89 Cr from 5.02 Cr in the said month.

According to market research, the securities brokerage market will become a $6.21 Bn opportunity by 20230 growing at a CAGR of 8%.