'Why Take On The Burden Of Expectation?': Zerodha's Nithin Kamath On Why He Is Steering Clear Of An IPO As Company Churns Profit Of ₹4,700 Crore

For many, having their company listed on the equity markets is a summit in the realm of business and entrepreneurship. This is more relevant in the current times, given the number of IPOs and eventual listings that the Indian markets have paved way for. In fact, as per RBI, September 2024 is one of the busiest IPO months.

No Plans For IPO

However, for some, irrespective of the lucrative prospects and mind-numbing number attached to them. One such example is the trading platform entity, Zerodha. In a recent statement, company co-founder Nithin Kamath said that his company is standing clear of the venture of an Initial Public Offering or IPO.

According to Kamath, he is circumspect of what it could bring to the company in terms of an increased valuation. However, Kamath believes in making decisions according to the situation. He said, "Why take on the burden of expectation from investors when there is nothing strategic or material to gain for the business?."

A major deterrent for Kamath is the focus and pathway followed by the company, once it switches to being a publicly listed company.

No Quarter-to-Quarter Business

Many companies, as per Kamath, transition or modify into a different entity as its prime focus changes.

From being a trading platform facilitating the process and progress of the growth trading paradigm, a company like Zerodha would have to change its spectrum of functioning. It would have to follow a quarter-to-quarter to approach, depleting space for any major changes that could affect and thereby reflect in the quarterly calls.

Zerodha Profits Jump 61%

According to recent reports, Zerodha managed to churn an overall revenue of Rs 8,320 crore in FY24 or fiscal year 2023-24. In addition, the company also bagged profits worth Rs 4,700.

This figure is far greater than the previous fiscal's (FY23) Rs 6,875 crore in total revenue, where the total profit achieved stood at Rs 2,907 crore. This marked an increase of 21.01 per cent in total revenue, along with a 61.67 per cent jump in profits.