Billionbrains Garage Ventures, the parent company of stockbroking platform Groww, on Wednesday, October 14, reported a 1.3% quarter-on-quarter decline in consolidated net profit to ₹725.7 crore for the September quarter (Q2 FY27), down from ₹735.04 crore in the preceding quarter. Revenue from operations remained largely unchanged sequentially at ₹1,501.5 crore, compared with ₹1,501.42 crore in the June quarter.

The quarter presented a mixed picture: sequential performance was broadly flat, but year-on-year growth remained strong. Revenue from operations rose 47.4% from ₹1,018.74 crore in Q2 FY26, while net profit increased 53.9% from ₹471.34 crore in the year-ago quarter. Groww also added 11 lakh new transacting users during the period, while its mutual fund and wealth management businesses continued to expand, even as the equity derivatives segment remained under pressure following the introduction of the Closing Auction System (CAS), management said.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) stood at ₹963.8 crore, marginally higher than ₹963.37 crore in the previous quarter, with the EBITDA margin unchanged at 64.2%.

Total income, including other income, was ₹1,540.54 crore in Q227, compared with ₹1,548.67 crore in Q1 FY27 and ₹1,070.80 crore in Q2 FY26. Profit before tax stood at ₹983.86 crore, against ₹992.27 crore in the preceding quarter and ₹637.68 crore a year earlier.

For the first half of FY27, revenue from operations rose to ₹3,002.95 crore from ₹1,923.14 crore in the corresponding period last year, while consolidated profit for the six months increased to ₹1,459.74 crore from ₹849.69 crore in H1 FY26.

Equity derivatives remain under pressure

Groww said its equity derivatives revenue declined 14.3% quarter-on-quarter, with management attributing most of the decline to the introduction of the Closing Auction System.

Effective August 3, 2026, the Securities and Exchange Board of India (SEBI) introduced CAS for stocks eligible for futures and options (F&O) trading. The system replaced the earlier volume-weighted average price (VWAP) method with a 20-minute closing auction conducted from 3:15 p.m. to 3:35 p.m.

According to the company, during the initial adoption phase a disparity emerged between the 3:15 p.m. reference price, based on the 3:00 p.m. to 3:15 p.m. VWAP, and the equilibrium price published from 3:20 p.m. The company said this contributed to a decline in trading volumes across the industry.

In its shareholder letter, management said the decline in Groww's equity derivatives revenue was in line with the broader industry trend. The episode illustrates how directly market-structure changes at the exchange level flow into broker earnings, since derivatives turnover converts into revenue within the same quarter — a linkage visible in Groww's own numbers, where a 21% sequential drop in derivatives premium turnover accompanied the 14.3% revenue decline.

SEBI's consultation paper proposes delinking derivatives settlement from CAS closing prices. Because the proposal is still at the consultation stage, its final shape and timing remain open, making the regulator's decision the near-term variable to watch for this segment. Groww said implementing the proposal should help normalise trading activity.

Management also said it expects the contribution of less-penetrated products, particularly margin trading facility (MTF) and commodity derivatives, to increase in the coming quarters.

Product diversification gains traction

While equity derivatives faced pressure, Groww reported increased contributions from MTF, commodity derivatives and other operating income, supported in part by activity in the primary market.

The company's disclosed product revenue mix showed the share of equity derivatives declining by approximately seven percentage points between Q1 FY27 and Q2 FY27, while MTF and commodity derivatives increased their contributions. A broader mix matters for the platform because it lowers dependence on any single revenue stream at a time when one of its key segments is exposed to regulatory change.

The stocks category includes brokerage, which accounts for approximately 70-75% of stocks revenue, along with depository participant (DP) charges, DDPI, pledge charges and auto-square-off charges.

Groww also noted changes to its revenue classification to reflect the evolving business mix. Treasury income is now classified as other income; IPO and Basic Services Demat Account (BSDA) revenue has moved from stocks revenue to other operating income; and delayed payment charges have moved from other operating income to float.

The company said the increased contribution from less-penetrated products could support further diversification of its revenue mix.

11 lakh new transacting users added in Q2

Groww added 11 lakh new transacting users (NTUs) during Q2 FY27, supported by primary-market activity. The shareholder letter said 42 lakh users applied for equity initial public offerings (IPOs) through Groww during the quarter, giving the platform a 22% share of total allotments. Since the company credits primary-market activity for part of this growth, the depth of the IPO pipeline is an operating variable to watch alongside core turnover metrics in the coming quarters.

The company's key platform metrics for the quarter showed:

• Total transacting users: 2.4 crore, up 27% YoY
• Total customer assets: ₹3.9 lakh crore, up 46% YoY
• Mutual fund systematic investment plan (SIP) inflows: ₹14,347 crore, up 8% QoQ from ₹13,229 crore
• Stocks average daily turnover (ADTO): ₹14,430 crore, down 9% QoQ from ₹15,801 crore
• Equity derivatives premium ADTO: ₹12,322 crore, down 21% QoQ from ₹15,661 crore
• Average MTF funding book: ₹4,351 crore, up 15% QoQ from ₹3,775 crore

The operating metrics reflect the divergence between equity derivatives activity and other parts of Groww's business. SIP inflows and MTF funding increased, while stocks turnover and equity derivatives premium turnover declined sequentially.

State Street Global Advisors investment

In its standalone results, the company recognised a gain of ₹81.1 crore from the sale of an investment in a subsidiary during the quarter.

The filing said the investment transaction involving State Street Global Advisors in Groww Asset Management Company (AMC) was completed on August 4, 2026. Following the transaction, State Street Global Advisors holds 4.85% of the voting rights and a 22.94% economic interest in Groww AMC. State Street Global Advisors, part of US-based State Street Corporation, ranks among the world's largest asset managers.

Groww AMC AUM crosses ₹7,000 crore; wealth assets exceed ₹10,000 crore

Groww's newer businesses continued to scale during the quarter, with growth in its asset management and wealth offerings.

Groww AMC's assets under management (AUM) increased 31% quarter-on-quarter to ₹7,179 crore from ₹5,491 crore in Q1 FY27. On a year-on-year basis, AMC AUM rose 145% from ₹2,928 crore.

The share of actively managed AUM increased to 57% from 47% a year earlier. AMC revenue grew 131% YoY during the quarter, although the business reported a bottom-line loss of ₹8.3 crore. For perspective, even after that growth, the AMC's ₹7,179 crore AUM remains a small fraction of Groww's ₹3.9 lakh crore in total customer assets — a gauge of how early in its build-out the asset management business is.

The company also said its wealth assets crossed ₹10,000 crore.

Composite scheme of arrangement

The company also noted a composite scheme of arrangement involving subsidiaries. The proposed scheme includes the demerger of identified business undertakings of Finwizard Technology into Groww Wealth Tech and Fisdom Broking, and the amalgamation of Finwizard Technology Services and Finwizard Securities into Finwizard Technology.

The scheme remains subject to the requisite approvals, with an appointed date of April 1, 2027 — making its progress through the approval process a structural item to track alongside quarterly results.

Share price movement

Shares of Groww fluctuated between gains and losses after the results announcement and were trading 0.7% lower on Wednesday at ₹192.54. The stock is up 24% so far this year.