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Zerodha sees end of zero brokerage model after new fee rules

Economic Times

Economic Times · 1y ago

Zerodha sees end of zero brokerage model after new fee rules

Zerodha, India's largest discount broker, may have to abandon its zero-brokerage model and increase derivative trading fees following a mandate by the market regulator, SEBI. The new fee structure, which comes into effect in October, aims to curb excessive trading in segments like derivatives. Nithin Kamath, CEO of Zerodha, said the changes will have a significant impact on the industry and that other brokers will also need to adjust their pricing. The move has caused a drop in stock prices for listed brokerages such as Angel One, SMC Global Securities, and Motilal Oswal.

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Related News

Equity investors saved up to Rs 20,000 crore in 10 years on zero brokerage: Nithin Kamath

Economic Times

Economic Times · 11m ago

Equity investors saved up to Rs 20,000 crore in 10 years on zero brokerage: Nithin Kamath

Zerodha CEO Nithin Kamath revealed that investors saved between Rs 2,000 crore and Rs 20,000 crore over a decade after Zerodha eliminated brokerage charges for equity delivery. Despite challenges, the zero-brokerage policy remained, reflecting the substantial savings compared to standard market rates. Kamath emphasized the impact of brokerage costs on returns, stating these often-overlooked costs hinder profits. He clarified Zerodha's name origin as "Zero + Rodha" (barriers in Sanskrit), not "Zero + brokerage."

Zerodha Mulls Ending Zero-Brokerage Model

Inc42 · 5m ago

Zerodha Mulls Ending Zero-Brokerage Model

Zerodha, a leading fintech company, is considering ending its zero-brokerage model for equity delivery trades due to governmental crackdowns on futures and options (F&Os). Founder and CEO Nithin Kamath mentioned that to keep the business viable, charging brokerage fees might become necessary. This potential shift comes as the company's brokerage revenues have dropped by 40% year-on-year, influenced by various regulatory changes impacting trading volumes and the financial viability of the current business model.

Zerodha Success Story - The Largest Stock Broker in India

StartupTalky

StartupTalky · 1y ago

Zerodha Success Story - The Largest Stock Broker in India

Zerodha is an online discount broking company based in Bangalore, India. Founded in 2010 by brothers Nithin and Nikhil Kamath, Zerodha aims to provide brokerage facilities to stock market traders at lower costs. The company operates on a low margin and high volume model, charging a minimal fee per transaction. It has gained popularity for its innovative ideas and unique strategies, and currently has a client base of over 6.3 million. Zerodha also offers other services such as currency and commodity trading, mutual funds, and bonds.

Zerodha not increasing brokerage charges yet: Nithin Kamath

Economic Times

Economic Times · 1y ago

Zerodha not increasing brokerage charges yet: Nithin Kamath

- Zerodha, a Bengaluru-based brokerage firm, will not increase its brokerage charges, including equity delivery which will remain free. - Stock exchanges BSE and NSE have started implementing a uniform fee structure based on transaction fees per trade, replacing the previous turnover-based fee structure. - NSE has introduced new transaction fees of Rs 2.97 per lakh of traded value in the cash market, Rs 1.73 per lakh of traded value in equity futures, and Rs 35.03 per lakh of premium value in equity options. - Zerodha expects a 10% decline in revenue due to the new fee structure, along with the increased securities transaction tax (STT) announced in the July Budget. - The STT for options has been increased to 0.1% from 0.0625%, while transaction charges have decreased to 0.035% from 0.0495%. In the futures segment, the STT has been raised to 0.02% from 0.0125%, with transaction charges decreased to 0.00173% from 0.00183%. - The impact of the changes in STT and transaction charges will be more significant for futures traders, as STT is charged on the entire contract value.

Zerodha crosses $1B in revenue in FY24; profit up 89%

YourStory

YourStory · 1y ago

Zerodha crosses $1B in revenue in FY24; profit up 89%

Online brokerage platform Zerodha reported an 89% increase in net profit for FY24, reaching ₹5,496 crore from ₹2,908 crore the previous year, driven by a 37.16% rise in revenue to ₹9,372 crore. However, the company anticipates a 10% revenue dip this fiscal year due to SEBI's new fee regulations and a potential 30-50% drop in index derivatives trading. To adapt, Zerodha plans to diversify into margin trade funding, investments, and loan-against-securities services, as shared by co-founder Nithin Kamath.

Zerodha Sticks To Zero-Brokerage Model As SEBI Norms Kick In

Inc42 · 1y ago

Zerodha Sticks To Zero-Brokerage Model As SEBI Norms Kick In

1. Zerodha may no longer offer zero brokerage due to new SEBI mandates. 2. The new mandates prohibit discounts based on trading volumes or members' activities. 3. Zerodha's consolidated net profit increased by 61% to INR 4,700 Cr in FY24. 4. The company's operating revenue rose by 21% YoY to INR 8,320 Cr. 5. The mandates came into effect on October 1, impacting market infrastructure institutions.

Uber releases SaaS model, drops auto drivers' commission: Report

Inshorts · 1y ago

Uber releases SaaS model, drops auto drivers' commission: Report

Ride hailing service provider Uber has rolled out software-as-a-service (SaaS)-based zero commission model for auto drivers across India according to a report by Inc42. The report added that this comes over a year after Rapido expanded its subscription fee-based model to autos. Uber reportedly said that it will solely act as a technology platform connecting riders with independent driver partners.

Subscription Model For Ola Drivers To Avail Zero Commission

Inc42 · 8m ago

Subscription Model For Ola Drivers To Avail Zero Commission

Ola has introduced a zero commission model for drivers, requiring them to pay a monthly fee of INR 2,010, or INR 67 per day, through a 30-day subscription pass. This model is available nationwide and applies to all types of bookings including cabs, autos, and bikes. This move places Ola alongside companies like Rapido and Namma Yatri, which have also implemented similar zero commission schemes for their drivers.

Bengaluru needs a 'Dalal Street': Zerodha CEO Kamath

Inshorts · 2y ago

Bengaluru needs a 'Dalal Street': Zerodha CEO Kamath

Nithin Kamath, CEO of Zerodha, suggests having a 'Dalal Street' symbolically in Bengaluru, as over 50% of retail trades in India originate from there. Fintech startup Groww recently surpassed Zerodha as India's leading brokerage in terms of active investors. Groww has seen significant customer growth, while Zerodha's user base has remained stagnant, attracting new competitors like HDFC Bank.

Zerodha started in 2010; It took me 20yrs to be successful, says Nithin Kamath

IndianStartupNews

IndianStartupNews · 2y ago

Zerodha started in 2010; It took me 20yrs to be successful, says Nithin Kamath

Nithin Kamath, the CEO of Zerodha, India's largest stock brokerage firm, shared insights on success and hard work in a podcast. He began trading in 1997 and started Zerodha in 2010, with significant success coming in 2016, illustrating that it took 20 years for his journey to succeed. Other guests, including Nikhil Kamath, also discussed the role of hard work in achieving success. Zerodha, specializing in discounted brokerage services, recorded substantial revenues and profits in fiscal year 2022.

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