Shares of Billionbrains Garage Ventures, the parent company of the popular discount broking platform Groww, climbed 3% during intraday trading on Tuesday, January 6. This move stood out against a generally subdued market sentiment, driven by a positive initiation report from domestic brokerage Motilal Oswal Financial Services (MOSL).
Brokerage Bullishness: A 'Buy' Call and Price Targets
Motilal Oswal has commenced coverage on Groww's stock with a 'buy' recommendation and has set a target price of ₹185 per share. This projection indicates a potential upside of approximately 19% from the stock's previous closing price. It is noteworthy, however, that this target sits below the stock's all-time high of ₹193.91, which it reached in November 2025.
The company made its debut on Dalal Street on November 12, 2025, listing at a 14% premium and then proceeding to rally for five consecutive sessions. Groww has achieved remarkable scale, becoming the largest retail broking platform in India within just four years of launch, commanding a dominant market share of 26.6%. This is nearly 9 percentage points higher than its closest competitor.
What's Driving the Optimism?
MOSL's bullish stance is rooted in Groww's successful transformation from a niche mutual fund distributor to a comprehensive, full-stack investment platform. This evolution has fueled impressive financial performance. The brokerage notes that the company's revenue surged roughly threefold from FY23 to FY25, and it anticipates this revenue to double again between FY25 and FY28.
A key strength highlighted is revenue diversification. MOSL points to Groww's expansion into Margin Trading Funding (MTF), commodities trading, credit products like Loan Against Securities (LAS), and an upcoming foray into wealth management. These initiatives are expected to reduce dependence on the core, and sometimes volatile, equity broking business. The brokerage forecasts the broking revenue contribution to moderate to 64% by FY28 from 85% in FY25, leading to a more resilient earnings profile.
Furthermore, Groww benefits from a high-operating leverage model. With about 90-91% of its costs being fixed, it achieved a robust operating margin of 59% in FY25. As revenues grow from new business lines while fixed costs remain stable, MOSL expects the EBITDA margin to expand to 68% by FY28.
Growth Trajectory and Risks
Despite regulatory actions on the Futures & Options (F&O) segment at the end of FY25, MOSL models a 10% earnings growth for Groww in FY26, followed by a much stronger 50% and 32% growth in FY27 and FY28, respectively. The brokerage identifies further F&O regulations and heightened competition as the primary risks to this outlook.
In an optimistic bull-case scenario, MOSL envisions a far higher share price target of ₹260, implying a massive 67% surge from recent levels. This scenario assumes stronger growth across all metrics:
- Operating revenue CAGR of 33% over FY25-28 (vs. 25% base case).
- EBITDA CAGR of 36% (vs. 30% base case).
- Profit After Tax (PAT) CAGR of 39% (vs. 30% base case).
The brokerage concludes that the combination of an underpenetrated market, improving infrastructure, and changing investor behavior is reshaping India's financial landscape, solidifying the long-term shift toward digital and low-cost brokerage platforms like Groww.
Disclaimer: This analysis is for informational purposes only. The views and recommendations are those of the brokerage firm. Investors are strongly advised to consult with certified financial experts before making any investment decisions, as market conditions are dynamic and individual circumstances vary.
