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Following Rs 1,050 crore of revenue with profitability in FY23, stock broking platform Upstox delivered another notable year with 25% year-on-year growth during the fiscal year ended March 2024. Moreover, the profits jumped 8X to Rs 190 crore in the same period.
Upstox’s revenue from operations grew to Rs 1,311 crore in FY24 from Rs 1,050 crore in FY23, according to the company’s press release.
Upstox provides retail investors with investment options, including stocks, IPOs, futures & options (F&O), commodities, currencies, fixed deposits, peer-to-peer lending, government bonds, non-convertible debentures (NCDs), gold, and insurance. According to the company, it has a user base of 1.7 crore, with a significant 85% of its customers coming from tier II and III cities.
“In FY24, we focused on innovation and high-impact growth, ensuring every investor and trader has the best tools at their fingertips. We are building a profitable, innovation-driven, and customer-first company that sets new benchmarks in security, speed, and simplicity” Ravi Kumar, CEO and Co-founder, Upstox said in the press release.
In May 2024, the firm also entered the insurance distribution business.
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, holding 38.54%. The founding team including Ravi Kumar, Shrini Viswanath, and Kavitha Subramanian own 36.12% of the company. Raghu Nathan Kumar, the company’s director, has 15% stake.
In October 2024, the company completed a buyback of 5% of Ratan Tata's holdings, reflecting a 10X return on Ratan Tata's original investment, while he retains 95% of his stake in the company.
Upstox's major competitors include Zerodha, Groww, Angel One, and PhonePe’s Share.Market. In FY24, Groww's revenue surged to Rs 3,145 crore, Zerodha reported Rs 8,370 crore in revenue and Rs 5,496 crore in profits. Angel One recorded Rs 4,280 crore in revenue in the previous fiscal year.
According to the National Stock Exchange, Upstox ranks fourth in active users, with 2.89 million. Groww holds the top position, followed by Zerodha and Angel One.
The stock broking and investment space has finally found its clutch of key players, after being dominated by Zerodha for a long time. A sustained bull run has helped, supporting the onboarding of new users. However, the effective pause on the F&O trading segment for retail users in 2024 will show up in results going forward, especially 2025-26. Add to that the weakness seen in stocks since August 2024, and it would be really interesting to see how this clutch of firms fare this year. Upstox of course has the added wind of profitability behind it now, and with a wide array of offerings, much to chase. The firm seems happy enough to cede space to Zerodha and Groww in tier 1 cities for now, and clearly, no one is interested in a bruising price war, even though their balance sheets are well fortified as compared to say, three years back. As funded firms, Upstox and Groww will obviously face more pressure to go public possibly, and that, when it happens will be a real event, as they should get much better valuations than bank owned broking firms like ICICI Direct got.