Zerodha posts Rs 1,122 Cr profit in FY21; revenue past Rs 2,700 Cr

One of the most surprising developments post-pandemic, the hyper-growth in stock market investments from retail investors has led to tremendous growth for stock market trading platforms. Perhaps none as visible as Zerodha.  

For Bengaluru-based Zerodha founded by the Kamath brothers, 2021 delivered the biggest year ever in terms of new customers and business volumes. 

The number of active clients on Zerodha’s share broking platform ballooned 2.4X to around 33.91 lakhs during FY21 as compared to 14.14 lakh users as a new wave of retail investors joined the public markets during the post-March 2021 bull rally, as per NSE data. 

The new legions of investors made their impact on revenues too, with income from operations growing around three folds to Rs 2,729 crore in FY21 from Rs 938.45 crore in FY20.

The company has booked around 82.5% of its operating revenue under “sale of service” which includes brokerage fees, sale of its premium tech products such as Kite Connect API, user onboarding collections and exchange transaction charges collected from clients on behalf of various securities exchanges. This collection grew over 3.1X to Rs 2,252.5 crore during FY21 from Rs 718.4 crore collected during FY20.

The remaining 17.5% of the operating revenue is booked under “Miscellaneous other operating revenues” which is primarily the interest on financial securities and margin interest charged by the company from its clients. This revenue vertical grew around 2.2X from Rs 220.05 crore in FY20 to Rs 476.4 crore during FY21. Entrackr has verified these revenue streams from Zerodha’s co-founder and chief executive Nithin Kamath.

As mentioned earlier, Zerodha collects exchange translation shares from its clients on the trades made via its brokerage platform and disburses them to the respective securities exchanges. These payments were booked as expenses grew in line with brokerage, i.e 2.8X to Rs 737.2 crore during FY21 from Rs 259.74 crore in FY20. Nithin confirmed this to Entrackr.

Employee benefits is the largest operating expense incurred by the company, accounting for 25.1% of annual costs. These payments grew by 104% from Rs 155 crore in FY20 to Rs 316.43 crore during FY21 including ESOP buyback payments of Rs 81.21 crore.


Zerodha had introduced a new ESOP pool worth Rs 100 crore at the start of Q3 2022 after executing the buyback during FY21. At the start of fiscal 2020-2021, Entrackr had exclusively reported about the revised remuneration plan for the promoters passed by the Zerodha board. 

The new plan was put in place and both Nithin and Nikhil’s remuneration was raised by 200% to Rs 36 crore while Seema Patil got a 113% raise and was awarded a salary of Rs 24 crore in FY21.

Moving further down the expenses sheet, we observed that Zerodha’s information technology expenses surged 2.6X to Rs 169.8 crore during FY21 from Rs 66 crore incurred during FY20 as the number of trades and active clients on its platform grew massively. 

The Bengaluru-based company also spent around Rs 12 crore on CSR projects including the provision of special education,  Livelihood enhancement projects, animal welfare, healthcare, environmental sustainability and governmental COVID relief funds. It also runs the Rainmatter Foundation, focused on fellowships and investments for individuals and organisations in the environment space. 

Overall, Zerodha’s annual expenditure grew 2.4X to Rs 1260.2 crore in FY21 from Rs 517.7 crore. On a unit level, it spent Rs 0.46 to earn a single rupee of operating revenue, improving by 16.4% as compared to Rs 0.55 spent to earn the same during FY20. This incremental improvement in margins even with over three-fold growth in scale highlights the sustainability of Zerodha’s growth model as a bootstrapped company, compared to other venture-backed firms in the ecosystem.


The company has posted annual profits of Rs 1,122.3 crore for the fiscal ended in March 2021, registering a 2.6x growth as compared to profit of Rs 424 crore booked during FY20. This makes Zerodha the first pure-play consumer internet company in India to cross Rs 1,000 crore in profits in a fiscal year.

For Zerodha, which has been in the news not just for its scorching growth but also reticence to go public, it has almost been an article of faith for the founders to stress that the growth depends on market conditions, and a bear market could change things very quickly. Perhaps meant more as a warning to investors in competing firms than its own users, the bootstrapped startup has certainly earned the kind of consumer goodwill and loyalty that competition would kill for. 

Nithin, speaking to Entrackr, has already indicated that this financial year (FY22)  is likely to see a tapering off of growth rate for the firm, as a combination of market volatility and saturation take their toll finally.

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