A few days ago, Zerodha, founded by Kamath brothers in 2010, emerged as the biggest broker in terms of number of clients. With 8.47 lakh active clients at the end of 2018, Zerodha outpaced biggies like ICICI Securities, HDFC Securities, Sharekhan, Axis Securities and Angel Broking. Now, the discount broking pioneer has undergone changes in its corporate structure. This may be one of the steps that will eventually lead Zerodha to attempt a public market listing at an appropriate time.
In a notice sent to Zerodha investors, the Bangalore-headquartered company informed that the constitution of Zerodha has been converted from the earlier structure of a Partnership firm to a Corporate entity. “Zerodha Broking Limited, the new Corporate entity, has been issued a new certificate of membership by SEBI bearing the same registration number, i.e., INZ000031633. The power of attorney for your demat account with Zerodha Securities Pvt. Ltd. will continue to be applicable in the same form, with all clauses in favour of Zerodha Broking Ltd. This power of attorney is used to debit the demat account when you sell securities,” said the Zerodha communique.
From a stock investor perspective on Zerodha, there are no major changes except some small tweaks so that your experience remains hassle-free. If you are transferring funds for trading to 05230340001348 via NEFT/RTGS/IMPS, please change this to ZERNSE effective immediately. Unlike usual bank account numbers, Zerodha’s new bank account number just has alphabets (ZERNSE). Trading margins may not get updated if you transfer funds to 05230340001348.
Zerodha has 1+ million clients. It accounts for 10% of daily retail trading volumes across NSE, BSE, MCX. The change in the constitution of Zerodha from Partnership firm to Corporate entity can be one of those steps that will eventually lead to an IPO for Zerodha. In Last September, Angel Broking had filed documents for a reported Rs 600-crore IPO. ICICI Securities is already listed, and so is Motilal Oswal. In 2017, 5Paisa – hived off from financial services provider IIFL Holdings – became India’s first online trading firm to list on exchanges. The stock listed at Rs 400 but now is available for Rs 224 apiece.
In 2017, Zerodha founder Nitin Kamath had talked about Zerodha hitting Rs 120 crore profit by end of March 2017. In April 2018, Zerodha had informed that it has over Rs 300 crore of own capital in the business. Last year, Zerodha had received non-banking finance licence from the RBI.