Groww Q3 Results: Stock recovers after rise in MTF book market share, transacting users

Shares of Billionbrains Garage Ventures Ltd. recovered from the initial fall on Wednesday, January 14, in response to its December quarter results. The recovery came in response to its result internals.

Groww total transaction users at the end of the December quarter increased by 7% from the previous quarter and 25% from last year to 2 crore.

Total customer assets increased by 39% from last year and 12% sequentially to ₹3 lakh crore, while the market share of its MTF book, which the company's management has earlier spoken about growing in the medium to long term, increased to 2% from 0.7% last year.

For other financial metrics, net profit for the period increased by 16% on a sequential basis to ₹547 crore from ₹471 crore in September. The net profit figure is lower on a year-on-year basis, due to a one-time gain of ₹315 crore in the base quarter.

The  revenue grew by 19.4% on a quarter-on-quarter basis to ₹1,216 crore from ₹1,019 crore.

Groww's Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter increased by 19% to ₹720.3 crore from ₹604 crore in the September quarter.

EBITDA margin for the quarter remained flat at 59%, which was also the same figure it reported during the September quarter.

In a separate filing, Groww highlighted that the company, along with its wholly-owned non-material subsidiary Groww Asset Management Company (Groww AMC) has executed a share purchase agreement with State Street Global Advisors, a US-based firm.

State Street will be investing a sum of ₹580.2 crore for a secondary purchase and primary subscription of shares resulting in a dilution of 23% of the fully diluted share capital of Groww AMC.

Earlier in the day, brokerage firm Citi initiated coverage on Groww, with a "buy" recommendation and a price target of ₹195 per share.

Shares of Billionbrains Garage Ventures recovered from the lows of the day and are now trading 1.3% higher at ₹164.82.