Groww Q2 Results 2025: Profit Surges 12% YoY Despite Revenue Decline – Complete Analysis

Groww [finance:Billionbrains Garage Ventures Limited] reported its first quarterly earnings post-IPO listing on November 21, 2025, showcasing a 12% year-on-year increase in net profit to ₹471 crore despite a 9.5% revenue decline. The results highlight the brokerage platform’s operational efficiency amid challenging market conditions and regulatory headwinds in the derivatives segment.

Groww Q2 Results Overview

Billionbrains Garage Ventures Limited, the parent company of Groww, delivered its first post-listing quarterly results for Q2 FY26 (July-September 2025) on November 21, 2025. The Groww Q2 results demonstrated resilience with net profit climbing 12% year-on-year to ₹471.33 crore compared to ₹420.81 crore in Q2 FY25.

The Groww earnings report revealed a mixed performance with revenue from operations declining 9.5% YoY to ₹1,018.7 crore from ₹1,125.6 crore in the same quarter last year. This revenue decline was primarily attributed to regulatory changes in the derivatives trading segment that impacted brokerage income across the industry.

Despite the top-line pressure, Groww financial results showed impressive margin expansion with EBITDA surging 25% quarter-on-quarter to ₹604 crore. The EBITDA margin expanded significantly to 59.3% from 53.4% in Q1 FY26, reflecting strong operational leverage and cost optimization efforts by India’s leading digital brokerage platform.

Key Financial Performance Metrics

The Groww Q2 results presented several critical financial metrics that investors and analysts closely monitor. Total income for the quarter ended September 2025 increased 13% quarter-on-quarter to ₹1,071 crore compared to ₹948 crore in the previous quarter.

The sequential growth metrics tell a positive story with revenue advancing 12.7% quarter-on-quarter for the three months ended September, reaching ₹1,019 crore. This quarterly improvement suggests recovery momentum despite year-over-year headwinds from regulatory changes that affected the entire brokerage industry.

Revenue Analysis and Breakdown

Understanding the Groww revenue composition provides insights into how different business segments contributed to overall performance. The company generates revenue primarily from brokerage charges on equity, derivatives, and mutual fund distribution, along with margin trading facility (MTF) income and interest income.

Revenue from derivatives trading faced pressure due to regulatory adjustments implemented by SEBI in recent quarters. However, stock-related revenues showed improvement due to increased order values and pricing updates. Revenue per broking order stood at ₹19.8 in Q2 FY26 compared to ₹18 in Q2 FY25, indicating better monetization per transaction.

Margin Trading Facility (MTF) Performance

Groww’s MTF book demonstrated strong growth, rising to ₹1,668 crore from ₹1,036 crore in Q1 FY26. This represents a significant 61% quarter-on-quarter increase, indicating growing adoption of leverage products among users. Disbursements by the in-house NBFC during the quarter ended September grew to ₹144 crore.

The MTF segment represents a high-margin business opportunity that diversifies revenue streams beyond traditional brokerage. For investors looking to understand different trading approaches, comparing stock trading vs stock investing strategies provides valuable perspective on how platforms like Groww serve different investor segments.

Profitability and Margin Expansion

The standout feature of Groww Q2 results was the remarkable profitability improvement. Net profit surged 24.6% quarter-on-quarter to ₹471 crore from ₹378 crore in Q1 FY26. This impressive growth in the bottom line despite moderate top-line expansion demonstrates operational efficiency and scalability of the digital-first business model.

Operating income (EBITDA) rose 25% quarter-on-quarter to ₹604 crore, with the EBITDA margin expanding to 59.3%. This margin expansion of 590 basis points from the previous quarter reflects Groww’s ability to optimize costs while maintaining growth momentum. The company achieved this through controlled marketing expenditure and operational leverage from its tech-driven platform.

Cost Structure Optimization

Cost increases during the quarter were primarily attributed to branding-related activities. However, this was partially offset by lower performance marketing spend, demonstrating disciplined capital allocation. The company generated ₹471 crore in cash during Q2 FY26, strengthening its balance sheet position for future growth initiatives.

Operational Highlights

Beyond financial metrics, Groww’s operational performance showed several positive trends. The platform maintained its position as one of India’s leading digital brokerages with strong user engagement metrics and transaction volumes. Active users rose 3.2% quarter-on-quarter, driven by new user acquisition efforts and improved retention strategies.

The digital-first approach enables Groww to maintain low customer acquisition costs compared to traditional brokerages. This structural advantage, combined with high operational efficiency, positions the company well in the competitive Indian fintech landscape. Investors seeking to start their investment journey can benefit from understanding how to choose a demat account for beginners, with platforms like Groww offering user-friendly interfaces.

User Growth and Engagement Metrics

User acquisition and retention remain critical metrics for evaluating digital brokerage platforms. Groww’s active user base grew 3.2% quarter-on-quarter, indicating steady platform adoption despite market volatility. The growth was driven by both new user onboarding and increased activity from existing customers.

The platform’s focus on user experience and simplified investing interfaces resonates particularly well with younger, first-time investors. This demographic alignment supports long-term growth as these users mature in their investment journey and increase assets under management over time.

Revenue Per User Trends

Average revenue per user (ARPU) metrics showed improvement with revenue per broking order increasing to ₹19.8. This indicates successful monetization strategies including pricing optimization and cross-selling of higher-value products and services. The company’s diversification into mutual funds, IPOs, and wealth management products creates multiple touchpoints for revenue generation.

Impact of Regulatory Changes

The brokerage industry faced significant regulatory adjustments during FY25, particularly affecting derivatives trading. SEBI implemented stricter position limits and increased margin requirements to reduce excessive speculation and protect retail investors. These changes impacted transaction volumes across the industry, reflected in Groww’s 9.5% year-over-year revenue decline.

However, Groww’s diversified revenue model helped cushion the impact. The platform’s strong presence in equity cash markets, mutual fund distribution, and growing wealth products segment provided alternative revenue streams. This diversification strategy mirrors the importance of portfolio diversification that investors should practice, as detailed in guides about mutual fund investment strategies.

Stock Market Performance

Groww shares demonstrated volatility following the Q2 results announcement. The stock traded 5.4% higher at ₹165.17 immediately after results, with over 10 crore shares worth ₹1,775 crore traded on November 21, 2025. The market responded positively to the profitability improvements and margin expansion despite revenue headwinds.

Since its listing in November 2025, Groww stock has risen approximately 24.66% from its IPO price of ₹114, though the shares experienced a correction from record highs earlier in the month. The stock briefly entered the auction segment due to excessive volatility, wiping out over ₹22,000 crore in market capitalization in just two sessions before recovering to reclaim ₹1 lakh crore market cap.

Quarter-on-Quarter Comparison

Analyzing sequential trends provides better insights into business momentum compared to year-over-year comparisons affected by regulatory changes. Groww’s Q2 performance showed robust sequential improvement across key metrics:

• Revenue increased 12.7% QoQ from ₹904 crore to ₹1,019 crore
• Net profit surged 24.6% QoQ from ₹378 crore to ₹471 crore
• EBITDA grew 25% QoQ from ₹483 crore to ₹604 crore
• EBITDA margin expanded 590 bps from 53.4% to 59.3%
• Total income rose 13% QoQ from ₹948 crore to ₹1,071 crore
• Active users increased 3.2% QoQ
• MTF book jumped 61% QoQ from ₹1,036 crore to ₹1,668 crore

These sequential improvements indicate recovering momentum and suggest the business is adapting successfully to the new regulatory environment. The consistent margin expansion particularly stands out as evidence of operational scalability.

Future Outlook and Growth Strategy

Groww’s management emphasized focus on diversifying revenue streams beyond traditional brokerage. The company is investing in wealth management products, expanding mutual fund offerings, and developing its NBFC capabilities. These initiatives aim to reduce dependence on volatile trading volumes and build more stable, recurring revenue streams.

The platform’s technology infrastructure and user base provide strong foundations for cross-selling opportunities. As users mature in their investment journey, Groww can offer increasingly sophisticated products from basic equity trading to mutual funds, insurance, and wealth advisory services. This lifecycle approach to customer value maximization represents a significant long-term opportunity.

Market Position and Competition

Groww competes in India’s increasingly competitive discount brokerage space alongside established players and new entrants. The company’s differentiation lies in its mobile-first design, simplified user interface, and strong brand recognition among younger investors. Maintaining this competitive edge requires continued investment in technology, user experience, and customer education.

Industry dynamics favor platforms with scale, technology capabilities, and diversified revenue models. Groww’s large user base provides network effects and data advantages that can drive product development and personalization. The company’s focus on financial literacy and investor education also builds long-term brand loyalty and trust.

What Investors Should Consider

Investors evaluating Groww stock should consider multiple factors beyond quarterly results. The brokerage industry’s growth trajectory remains attractive given India’s low equity market penetration and rising household incomes. However, competitive intensity and regulatory risks require careful assessment.

Key investment considerations include:

• User Growth Sustainability: Can Groww maintain user acquisition momentum as competition intensifies?
• Monetization Improvement: Will ARPU continue increasing through cross-selling and product diversification?
• Regulatory Environment: How will future regulatory changes impact revenue and profitability?
• Market Conditions: Will trading volumes recover as market sentiment improves?
• Technology Investments: Is the company investing adequately in platform capabilities and security?
• Valuation: Does the current stock price reflect reasonable growth expectations and margin sustainability?

Building a diversified portfolio remains crucial for managing risk. Investors should consider allocation across multiple asset classes including stocks, mutual funds, and alternative investments. Resources like guides on digital gold investment and retirement planning through NPS help create balanced investment strategies.

Frequently Asked Questions About Groww Q2 Results

What were Groww’s Q2 FY26 results?

Groww reported net profit of ₹471 crore (up 12% YoY) and revenue of ₹1,019 crore (down 9.5% YoY) for Q2 FY26 in its first post-listing quarterly results announced November 21, 2025. The company demonstrated strong margin expansion with EBITDA margin reaching 59.3%.

Why did Groww revenue decline despite profit growth?

Groww revenue declined 9.5% year-over-year primarily due to regulatory changes in derivatives trading that affected the entire brokerage industry. However, profit grew 12% through operational efficiency improvements, cost optimization, and better margins. Sequential revenue grew 12.7% QoQ, indicating recovery momentum.

What is Groww’s EBITDA margin in Q2?

Groww’s EBITDA margin expanded to 59.3% in Q2 FY26 from 53.4% in Q1 FY26, representing a 590 basis points improvement. This reflects strong operational leverage and the scalability of Groww’s digital-first business model with optimized customer acquisition costs.

How did Groww’s user base perform in Q2?

Groww’s active users increased 3.2% quarter-on-quarter in Q2 FY26, driven by new user acquisition and improved retention strategies. The platform maintained its position as one of India’s leading digital brokerages with strong engagement metrics across equity, mutual funds, and derivative segments.

What is Groww’s margin trading facility (MTF) performance?

Groww’s MTF book grew significantly to ₹1,668 crore in Q2 FY26 from ₹1,036 crore in Q1 FY26, representing 61% quarter-on-quarter growth. Disbursements by the in-house NBFC reached ₹144 crore, indicating strong adoption of leverage products among platform users.

How has Groww stock performed after Q2 results?

Groww shares traded 5.4% higher at ₹165.17 after Q2 results announcement on November 21, 2025. The stock has risen approximately 24.66% since its IPO price of ₹114, though it experienced volatility with corrections from record highs before recovering to reclaim ₹1 lakh crore market capitalization.

What impacted Groww’s derivatives revenue?

SEBI’s regulatory adjustments on derivatives trading including stricter position limits and increased margin requirements reduced derivatives transaction volumes across the industry. Revenue per order from derivatives fell due to these regulatory changes, though stock-related revenues improved through pricing updates and increased order values.

Is Groww a good investment after Q2 results?

Investment decisions should consider multiple factors including user growth sustainability, monetization potential, regulatory environment, market conditions, and valuation. Groww’s improving margins and diversification strategy are positive, but investors should assess their risk tolerance and conduct thorough research before investing. Consider consulting platforms like Dhan or Zerodha for investment guidance.

What is Groww’s revenue per order?

Groww’s revenue per broking order stood at ₹19.8 in Q2 FY26 compared to ₹18 in Q2 FY25, representing a 10% improvement. This indicates successful monetization strategies including pricing optimization and improved product mix toward higher-value transactions.

How does Groww compare to other brokerages?

Groww competes with discount brokerages like Zerodha, Upstox, and Angel One in India’s digital brokerage space. The company differentiates through mobile-first design, simplified user interface, and strong brand recognition among younger investors. Its 59.3% EBITDA margin demonstrates industry-leading operational efficiency.

Conclusion: Groww’s Q2 FY26 results demonstrate operational resilience with 12% profit growth and impressive margin expansion to 59.3% despite industry headwinds from regulatory changes. The 24.6% quarter-on-quarter profit surge and recovering sequential revenue growth indicate successful adaptation to the new regulatory environment. Investors should monitor user growth sustainability, revenue diversification progress, and competitive dynamics while considering Groww stock as part of a balanced investment portfolio.