Groww Q2 profit up 54% to Rs 725 cr

BENGALURU: Online investment platform Groww’s net profit rose 54% from a year earlier to Rs 725 crore for the September quarter. Its revenue rose 44% to Rs 1,541 crore, with margin lending and commodity derivatives contributing a larger share.Sequentially, however, net profit fell 1.4% from Rs 735 crore in the June quarter, while revenue dipped 0.5% from Rs 1,549 crore.The company is also testing a US stock investing product, co-founder and CEO Lalit Keshre told analysts. He described it as a very early test and said there was no fixed timeline for a launch. “The feedback is really good from the customers,” he said, adding that Groww would continue refining the product based on their responses.Equity derivatives revenue fell 14.3% from the previous quarter. Groww attributed most of the decline to market adjustments following Sebi’s introduction of a closing auction system in August, which changed how closing prices are determined for certain stocks. The segment remained its biggest income contributor, but its share fell to 44.8% from 56.9% a year earlier.Management said proposed changes to derivatives settlement could help normalise trading activity. It cautioned that volumes would also depend on factors such as market volatility.Meanwhile, Groww’s outstanding margin trading loan book grew to Rs 4,351 crore from Rs 1,668 crore a year earlier. The facility allows customers to borrow funds to buy shares.Chief financial officer Ishan Bansal said Groww had tightened its lending policies and was examining exposure to individual stocks across the industry, alongside its own positions.“We have to start looking at the industry level book as well,” he said. Groww is excluding some stocks from its approved lending list or requiring higher margins. In some cases, Bansal said, it finances only 20% of the value, limiting its exposure if prices fall sharply.Expenses rose 29% to Rs 556 crore. Technology costs increased because of more trading days, greater use of AI and higher computing costs. Groww also incurred Rs 13 crore in one-time client reimbursements following an operational issue at a third-party market infrastructure institution. Management said delayed files on an expiry day had caused the issue.Marketing spending fell sequentially because IPL-related expenses incurred in the June quarter did not recur. Management said it typically spends Rs 400–500 crore annually on growth, with spending adjusted to market conditions.IPO activity helped Groww add 11 lakh new transacting users during the quarter. Total customer assets across its platforms rose 46% to Rs 3.9 lakh crore.You use AI every day. Now get your AI Quotient. Take the AIQ test.