Satya Nadella-Backed Groww Files for $9B India IPO

Bengaluru-based financial services platform Groww, India’s largest retail brokerage firm, filed draft papers on Tuesday for a historic multibillion-dollar initial public offering (IPO) in India, positioning itself to become the first venture-backed startup to list domestically after shifting its headquarters back from the United States.

Major Exit for Global Venture Capital Giants

The upcoming stock market debut, expected later this year, will serve as a massive liquidity event for some of the world’s most prominent venture capital firms. According to the draft red herring prospectus filed on Tuesday, Peak XV Partners, Y Combinator, Ribbit Capital, and Tiger Global plan to sell approximately 394 million shares. This combined divestment represents roughly 9.4% of Groww’s total equity base, making these four institutional investors the largest selling group, accounting for 69% of the total shares offered in the public sale.

The ‘Reverse Flip’ Trend Gaining Momentum

Groww is part of a broader wave of high-profile Indian technology companies repatriating their corporate structures. Startups like Pine Labs, Razorpay, Meesho, and Zepto have recently initiated or completed moves to shift their legal headquarters back to India. Similarly, Walmart-backed PhonePe completed its relocation from Singapore to India in 2022, and its former parent company, Flipkart, announced plans earlier this year to execute a similar move.

As one of the pioneers of this “reverse flip” transition, Groww migrated its parent entity from Delaware to India last year. This corporate relocation came with a hefty price tag, as the company paid approximately $159 million in taxes to execute the transition.

Why Startups Are Returning to India

Relocating corporate headquarters back home allows startups to align seamlessly with evolving local regulatory frameworks and satisfy strict domestic listing requirements. Additionally, accessing India’s public markets has become highly attractive due to a rapidly expanding domestic retail investor base and a strong appetite for local IPOs, highlighting the growing maturity and depth of India’s capital markets relative to overseas exchanges.

Founders Retain Equity Control Ahead of Listing

While global venture funds are capitalizing on the IPO to trim their stakes, Groww’s founders—Lalit Keshre, Harsh Jain, Neeraj Singh, and Ishan Bansal—are maintaining a highly conservative approach. The co-founders plan to sell only about 4 million shares combined, representing a mere 0.7% of the total offer for sale.

This minimal participation in the secondary sale indicates strong long-term confidence from the leadership team, who are retaining almost their entire equity ownership in stark contrast to the institutional backers seeking exits.

Financial Performance and IPO Valuation Details

The proposed IPO comprises a fresh issue of shares to raise ₹10.6 billion (approximately $121 million) in new capital, alongside a secondary offer of 574 million shares by existing stakeholders. The secondary portion is projected to raise between ₹5 billion and ₹6 billion (roughly $568 million to $682 million). The public listing is expected to value the Bengaluru-based fintech unicorn at $9 billion.

Groww’s financial health has shown robust improvement. For the fiscal year ending March 31, the company reported a total income of ₹40.6 billion (approximately $462 million), marking a 45% year-on-year growth. Net profit after tax reached ₹18.2 billion (around $208 million), a significant turnaround from the net loss of ₹8 billion (about $92 million) recorded in the previous fiscal year, which was heavily impacted by one-time expenses related to the Delaware-to-India corporate migration.

Dominating India’s Retail Investment Landscape

As of June, Groww commanded a massive share of India’s retail investment sector, boasting 37.4 million demat accounts, which accounts for nearly 19% of the national market. The platform also reported 12.6 million active clients on the National Stock Exchange (NSE), representing a dominant 26% market share. Furthermore, Groww manages approximately 17 million active systematic investment plans (SIPs) and serves 9 million unique mutual fund investors, making it the only investment application in India to cross the milestone of 100 million cumulative downloads.

The high-profile public offering is being managed and advised by a consortium of leading investment banks, including JPMorgan Chase, Kotak Mahindra Bank, Citigroup, Axis Bank, and Motilal Oswal Investment Advisors.