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Upstox claims Rs 1,000 Cr revenue and Rs 25 Cr PAT in FY23


The stock broking space appears to be the first consumer-facing internet segment where all major players registered profits in the last fiscal year. After Zerodha, Groww, and AngelOne, Tiger Global-backed Upstox also claims it turned profitable in the fiscal year ending March 2023.

Upstox reports that it registered a 44% year-on-year growth in its broking revenue and crossed a Rs 1,000 crore threshold during FY23.

The company also claims it achieved Rs 25 crore PAT (profit-after-tax) on a consolidated basis. This led to a massive improvement at EBITDA level which exceeded Rs 200 crore in FY23, the release said.

“Our journey towards profitability reflects our steadfast commitment to helping India ‘Invest Right,’” co-founder and CEO Ravi Kumar said in the release.

In FY22, Upstox’s revenue from operations spiked 77.4% to Rs 766 crore. Meanwhile, its losses ballooned 6.2X to Rs 445 crore during the same period. The FY23 numbers revealed by the company signifies a sort of turnaround but the clear picture of its profitability will be evaluated when Upstox files its audited statements with the RoC.

An Upstox spokesperson said that the turnaround to profitability in FY23 can be attributed to remarkable growth in overall revenue, resulting in operational leverage, strategic measures leading to acquiring large scale customers at lower average CAC, and overall prudence in expenses.

The company claims to have reached over 130 million users, largely millennials and investors from tier II and III cities.

Upstox has raised over $200 million to date and was valued at $3.5 billion in its last fundraise. According to the startup data intelligence platform TheKredible, Tiger Global is the largest external stakeholder with 38.54% holding. The founding team including Ravi Kumar, Shrinivas Vishwanath, and Kavitha Subramanian own 36.12% stake. Raghu Nathan Kumar, the company’s director, has 15% stake.

Upstox competes with the likes of Zerodha, Groww, and PhonePe’s Share.Market. In FY23, Zerodha registered a 38.5% growth in its scale to Rs 6,875 crore while its profit grew 38.5% to Rs 2,907 crore in the last fiscal year. Groww also reported profit of Rs 449 crore with 1,277 crore in revenue in the last fiscal year.

Upstox is the fourth largest player in the stock broking space in terms of active users. Currently, Groww leads the pack followed by Zerodha, AngelOne, Upstox, and ICICIdirect (ICICI Securities). It’s worth mentioning that all the top five players are profitable.

One would argue that if these players didn’t turn profitable now, they never would. Considering the near frenzy we are beginning to see among investors in the capital markets, with trading volumes in the retail segment at all time highs. However, while it is not for us to call a steep market correction, as and when the markets do correct, as they inevitably do, that will be a real test of these firms ability to stay profitable. While some like Zerodha have moved into segments like mutual funds to hedge against such an eventuality, others are considering riskier options including their own PMS schemes and the like.  Margins will remain under pressure as pricing will also have to remain very elastic, with the entry of fresh players, besides competition within the existing lot.  Incumbents like ICICIdirect backed by banks are also reworking hard to maintain profitability and protect turf. All in all, it’s a very interesting ride ahead for these firms as well as their customers, current and prospective. 

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