BofA Securities initiates protection on Groww with ‘purchase’ ranking; shares rally 4% to report excessive. Right here’s what the brokerage mentioned
The Wall Avenue financial institution mentioned Billionbrains Storage Ventureswhich runs the broking platform Groww, is “nicely positioned to capitalise on India’s retail investing tailwinds,” and expects the corporate to ship income progress at a 30% CAGR over FY26-28. The initiation provides heavyweight institutional backing to a inventory that has already delivered 31% returns in calendar yr 2026 alone.
BofA described Groww as having best-in-class profitability, with additional room for enlargement as working leverage builds. It tasks EBITDA margins rising to 67% and PAT margins to 52% by FY28—an unusually wealthy margin profile for a growth-stage fintech, which the financial institution believes units Groww other than friends. The brokerage valued the corporate at 39x FY28 estimated P/E.
The financial institution flagged two near-term dangers: a deterioration in broader capital market circumstances, which may crimp transaction volumes and damage income, and the expiry of a six-month post-IPO lock-in interval, which may result in a provide overhang as early buyers achieve the power to exit.
Final month, JPMorgan initiated protection on Groww with an ‘obese’ ranking and a worth goal of Rs 210 per share.
groww is the biggest dealer by lively shoppers, with a 28% market share, in contrast with 15% for the second-largest participant. This management is pushed by its robust mutual fund funnel, easy-to-use UI and UX, and sturdy word-of-mouth traction.
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