The festival season seems to have come early for online stockbroking platform Zerodha’s employees. The stockbroker firm has constituted worth Rs 200 crore an employee stock ownership plan (ESOP) for its 850 employees.
The allocation has been done on the basis of employees performance and gross earning over their years of service.
The calculation of ESOPs was done through an internal assessment, including Zerodha’s financials, cash in hands and future market opportunities.
The move has come after, Zerodha turned public limited entity from being a partnership firm.
The company plans to be listed in five years. The process will then allow employees with ESOPs to exit or vest their shares at market value, said an ET report quoting Zerodha CEO Nithin Kamath.
Kamath plans to offer employees an option to vest 33% of the shares after the first year to give liquidity options.
Over the years, startups have been offering ESOPs to retain good talents. Many startups such as OYO, Flipkart, Razorpay have been using ESOPs to keep its key employees and to ensure stability in management that allows healthy growth.
The nine-year-old firm offers retail and institutional broking, currencies and commodities trading, bonds and mutual funds investments.
Zerodha has memberships on all the stock, commodity, and currency exchanges in India. It claims to be one of the top volume contributors on NSE, BSE, MCX-SX, and MCX.
Zerodha Broking, Zerodha Securities, Zerodha Commodities, Zerodha Capital are Zerodha’s four registered entities.
The stockbroker claims to have a total client base of 1.6 million. Zerodha is one of the few fintech firms to be profitable. In FY 2019, the company claimed a net profit of Rs 350 crore.