Broking giant Zerodha is set to expand its financial services offerings with a planned entry into the investment banking business
The company has applied for a Category I merchant banker licence with the SEBI through its wholly owned subsidiary, Zerodha Corporate Advisors Pvt Ltd
According to SEBI's records, the application was filed on April 27 and is currently under review
Broking giant Zerodha
is looking to expand its financial services portfolio as it eyes a foray into the investment banking business.
The company has sought a Category I merchant banking licence from SEBI through its wholly owned subsidiary, Zerodha Corporate Advisors Pvt Ltd.
According to SEBI’s records, the application was filed on April 27 and is currently under review.
Responding to Inc42’s queries, Zerodha said, “We have filed an application for the merchant banking (Category I) licence with SEBI. We’ll be able to share more about our business plans once we receive the licence.”
The development was first reported by Business Standard.
For context, a Category I merchant banking licence authorises companies to operate as a full-service merchant banker. A company with the licence can manage IPOs, advise on fundraising and mergers and acquisitions, and more.
The investment banking push comes as Zerodha continues to expand beyond its core broking business, having already ventured into lending, asset management and startup investments.
Recently, Zerodha, Groww, Angel One and Upstox received approval from the International Financial Services Centres Authority (IFSCA) to offer investors access to international and US stocks through GIFT City.
While Zerodha and Upstox will operate as broker-dealers under the IFSCA framework, Groww and Angel One will function as Global Access Providers (GAPs).
The Nithin Kamath-led company is looking to diversify its revenue streams following SEBI’s tightening of F&O regulations and the slowdown in Indian equities markets which have put pressure on the revenues of broking companies.
Earlier this month, Zerodha also rolled out a slew of customer-focused measures in a bid to attract more users amid intensifying competition.
The company waived account maintenance charges (AMC) for the first year for all new users and announced refunds of up to ₹500 on depository transfer fees for customers shifting their portfolios to the platform.
The brokerage said the initiatives are aimed at removing small but recurring costs that often discourage first-time investors from opening demat accounts or switching brokers. Under the new policy, both new users and existing customers consolidating their portfolios on Zerodha are eligible for the transfer fee reimbursement.
The aggressive customer acquisition push comes as competition in the retail broking space continues to heat up.
According to NSE data, Groww remained India’s largest broker with 1.31 Cr active clients in May 2026, followed by Zerodha with 68.47 Lakh and Angel One with 66.76 Lakh.
During October 2025 to April 2026 period, Zerodha’s active client base fell about 2%, while Groww and Dhan saw growth of 8.1% and 7.1%, respectively.
The pressure reflected in Zerodha’s financial performance. In FY25, the company reported operating revenue of ₹8,847 Cr, down 12% from ₹9,993 Cr in the previous year. Net profit fell 23% YoY to ₹4,237 Cr, primarily due to SEBI’s tightening of F&O regulations and higher securities transaction tax (STT).
The company is yet to release its FY26 financial results.
Zerodha is among more than a dozen companies awaiting SEBI’s approval to enter the merchant banking business. Other applicants include Societe Generale Securities, InCred Capital Financial Services, Haitong Securities India, Capri Global Capital Markets, and more.
Source: Inc42 - Startups
