Groww IPO: Billionbrains Garage Ventures files DRHP via confidential filing route. Details here

Groww IPO: The parent company of stock broking firm Groww, Billionbrains Garage Ventures, has filed a draft red herring prospectus (DRHP) with the stock market regulator Securities and Exchange Board of India for an initial public offering (IPO). 

The DRHP, filed on May 24, is via a confidential pre-filing route. According to a PTI report, citing sources, Groww could look to raise between $700 million to $1 billion via the initial share sale. 

Groww, which is India's fastest-growing retail broking platform, is backed by several marquee investors like Peak XV, Tiger Capital, and Microsoft CEO Satya Nadella. 

As per the PTI report, Groww is looking to use the proceeds from the IPO, which is a combination of fresh share sale and offer for sale (OFS), for investment in technology development and business expansion.

To manage the offering, Groww has appointed JP Morgan India Private Ltd, Kotak Mahindra Capital Company Ltd, Citigroup Global Markets Private Ltd, Axis Capital Ltd, and Motilal Oswal Securities Ltd.

The company plans to list its shares on the mainboard — the National Stock Exchange and BSE Limited.

About Groww

Groww is a Bengaluru-based investment platform founded in 2016 by former Flipkart executives Harsh Jain, Lalit Keshre, Neeraj Singh, and Ishan Bansal. 

For the full financial year 2023-2024 (FY24), Groww reported strong financial growth despite a one-time tax hit.

The company incurred a net loss of ₹805 crore for the year, primarily due to a one-time tax expense of ₹1,340 crore related to shifting its domicile from the US to India. Operationally, Groww remained profitable, posting an operating profit of ₹535 crore in FY24—up 17% from ₹458 crore in FY23.

Groww’s revenue more than doubled to ₹3,145 crore in FY24, a 119% increase from ₹1,435 crore in the previous year.

Earlier this month, Singapore's sovereign wealth fund GIC sought fair trade regulator CCI's approval to acquire a 2.14% stake in Billionbrains Garage Ventures, a PTI report on May 15 said.

Why is confidential pre-filing gaining traction?

Groww, like many other companies lately, has opted for the confidential pre-filing route. It’s a mechanism that allows companies to withhold the details before making their IPO plans public.

This route is gaining traction among Indian firms aiming for flexibility in their IPO plans.

Unlike the traditional route, which requires companies to launch their IPOs within 12 months of receiving Sebi's approval, the pre-filing route extends this window to 18 months from the receipt of final comments. Additionally, firms can modify the primary issue size by up to 50 per cent until the updated DRHP stage.

Several prominent companies like Shiprocket, Tata Capital, PhysicsWallah and Imagine Marketing have opted for confidential pre-filing of their IPOs.

Tata Play, formerly Tata Sky, was the first Indian company to utilise the confidential filing option in December 2022 and received Sebi's observation letter in April 2023, though it later withdrew from the public issue, according to a report.

(With inputs from PTI)

Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.