Zerodha gets SEBI merchant-banking nod, targets new-age IPO mandates

Zerodha Corporate Advisors has received SEBI approval to begin merchant-banking operations in the coming months, initially pursuing IPO mandates from new-age companies. The move expands Zerodha beyond broking as trading revenue moderates.

— Source publishedThu, 3 Sept, 2026, 15:38 IST·First seen Thu, 3 Sept, 2026, 16:28 IST·Source Inc42

What happened

Zerodha received SEBI approval for merchant banking via Zerodha Corporate Advisors and will initially target IPO mandates from new-age companies. The move

Key facts

  • ₹55 Cr capital infused into merchant banking unit
  • Brokerage revenue: ₹2,738 Cr in FY26, down 10.4% from ₹3,066 Cr in FY25
  • Net profit: ₹4,283 Cr in FY26, up 1.2% from ₹4,231 Cr
  • MTF book: about ₹9,000 Cr; customer borrowing: about ₹6,000 Cr
  • Groww active clients: 1.31 Cr in July 2026
  • Zerodha active clients: 67.62 Lakh in July 2026
  • Zerodha NSE active-client share: 14.88%
  • Assets held on Zerodha platform: ₹9.05 Lakh Cr in FY26

Why this matters

The move positions Zerodha to compete for startup IPO relationships and may increase its need for partnerships or talent acquisitions in investment banking, compliance and underwriting.

What to watch

  • Announcement of the first Zerodha-led IPO mandate and whether it is mainboard, SME or startup-focused.
  • Senior hires from established merchant banks, investment banks or capital-markets law and compliance teams.
  • SEBI disclosures on underwriting permissions, conflict controls and merchant-banking operating scope.
  • Pricing of Zerodha's advisory and underwriting fees relative to incumbent merchant bankers.
  • IPO-market recovery, especially the pipeline of venture-backed new-age companies.
  • Evidence that Zerodha can mobilize retail IPO participation without raising conduct or allocation concerns.
  • Build a senior merchant-banking team with SEBI-registered compliance, due-diligence, underwriting and institutional-sales expertise.
  • Target startup and consumer-internet companies already connected to Zerodha's venture, founder and retail-investor ecosystem.
  • Develop IPO investor-access products that convert broking users into applicants while maintaining strict information-barrier and conflict-management controls.
  • Pursue smaller IPOs, pre-IPO placements and rights issues first to establish execution credentials before competing for marquee mainboard mandates.
  • Partner with or hire institutional distribution capabilities to address the gap between retail reach and anchor-investor placement.

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