Groww IPO: Justified valuation or time to chase better-valued rivals?

While Groww IPO attracts moderate interest, analysts debate if listed peers offer better value for money

Amid rising concerns over its valuation, the digital-first brokerage platform Billionbrains Garage Ventures (Groww) has received a moderate response from investors to its ₹6,632.30 crore Initial Public Offering (IPO), which opened for subscription on Tuesday, November 4, 2025.  The issue, comprising a fresh issue of 106 million equity shares worth ₹1,060 crore and an offer for sale (OFS) of 557.2 million shares by promoters and existing shareholders valued at ₹5,572.30 crore, was subscribed 57 per cent on the first day, according to data from the NSE.

Valuation and peer comparison

At the upper end of the price band, ₹100 per share, Groww’s valuation comes out to a price-to-earnings (P/E) ratio of 33.8x for FY25. While this figure is lower than the industry composite of 40.77x, it still implies a post-issue market capitalisation of ₹61,736 crore.

 

Compared to its listed peers, Groww’s P/E ratio sits in the higher range. However, it still lags behind some of the more richly valued players. Angel One, for example, trades at a P/E of 19.80x, Motilal Oswal Financial Services at 24.88x, and Nuvama Wealth Management at 26.85x. On the other hand, more expensive peers like 360 One WAM (P/E of 45.20x) and Prudent Corporate Advisory Services (P/E of 58.92x) command significantly higher valuations, according to the company's Red Herring Prospectus (RHP).  ALSO READ | Groww IPO opens Nov 4: Analysts offer mixed views; should you apply?

Optimism over business diversification

The question for potential investors is whether Groww’s valuation, at a 33.8x P/E, justifies a buy or if lower-P/E listed alternatives might be more attractive. For those willing to bet on Groww’s long-term potential, the company’s strategy of diversifying beyond its core broking business may hold promise, said analysts. 

 

Simranjeet Singh Bhatia, senior equity research analyst at Almondz Group, believes that despite its relatively high valuation, Groww offers attractive long-term value.  “Groww is actively reducing its dependency on broking, with revenue from the broking segment dipping to 79.69 per cent in Q1FY26, down from 83 per cent in FY25,” he said. “The company’s recent strategic investments, including the acquisition of Fisdom and the sixfold increase in its AUM to ₹2,000 crore following the acquisition of Indiabulls Asset Management, show a clear intent to diversify."

 

Bhatia also pointed to Groww’s expanding product suite, which now includes access to stocks, ETFs, US stocks, digital gold, corporate fixed deposits, and more. The company is investing ₹152 crore into cloud infrastructure, aiming for greater operational leverage as it scales. "Given this broadening of its platform, valuations are not expensive relative to the long-term growth potential," Bhatia added, noting that a re-rating could be on the cards.

Fully priced but long-term upside

Some analysts, however, believe that Groww’s IPO is priced to perfection. Anand Rathi Research, in its report, noted that while Groww’s ambition to build a pan-India brand centered around trust, transparency, and financial inclusion is promising, the IPO is already fully priced.

 

Nevertheless, the brokerage recommended subscribing to Groww’s IPO from a long-term perspective, pointing to the company’s diversified growth strategy. “Groww’s expansion into margin trading funding (MTF), commodity derivatives, API trading, and bonds shows its potential to widen its customer base and offerings,” the report added. “While its expansion plans are commendable, the current valuation suggests limited upside in the short term.”

Caution from market experts

Despite the optimism, not all analysts are sold on Groww’s valuation. Deepak Jasani, an independent market analyst, cautioned against relying too heavily on the P/E ratio. “P/E is a useful metric, but it should not be the sole basis for investment decisions. Growth prospects matter more,” Jasani said. “If a company is poised for higher growth, it could justify a higher multiple, even if its P/E ratio is higher than peers.”

 

Jasani stressed that the market evaluates stocks based on future growth potential, and while Groww may be priced higher than its peers, it is essential to assess its business model and growth trajectory on their own merits.