Groww shares at Rs 150 or Rs 235: What's next as stock surges 9%?

Billionbrains Garage Ventures Ltd (Groww) saw its shares surging 9 per cent on Tuesday, as the brokerage reported two-fold jump in its March quarter profit. While MOFSL has suggested a target of Rs 235 on the stock, JM Financial maintained its 'Sell' on the stock with a target of Rs 150. Foreign brokerages such as Citi, UBS and Jefferies suggested targets in the Rs 210-225 range.

Groww shares rose 8.96 per cent to eventually settled at Rs 214.05 for the day. Despite strong results, JM Financial said valuations at 38 times FY27 EPS and 29 times FY27 EPS remained ahead of meaningful traction in recurring revenue. 

"We value Groww at 10 per cent premium to Angel One for its superior earnings growth (of 41 per cent CAGR over FY26–FY28E versus 32 per ecnt for Angel One) for a revised target of Rs 150 (Rs 144 earlier), valuing it at 22 times FY28E EPS of Rs 6.8 (21 times FY28E EPS of Rs 6.70 earlier)," it said.

MOFSL said Groww has continued to report strong revenue growth, backed by rising user adoption of products as well as robust user activation. 

"Its brokerage business is gaining market share across segments, with recent product launches, such as MTF and commodities, fueling further growth. The rising number of affluent customers unlocks wealth management opportunities for the company, with the Fisdom acquisition giving a further boost," it said.

The brokerage expects the overall order run-rate in the broking segment for FY27 to largely maintain the Q4 order run-rate backed by market share expansion. MTF segment, LAS, and wealth management are expected to provide a further boost to the top-line. 

"However, this will be offset by a rise in costs, considering investments in AMC and wealth management business, as well as the enhancement of tech capabilities," it said.

MOFSL largely maintained its estimates considering revenue growth on the back of continued growth in order run rate, MTF book expansion, and rising contribution of LAS to the credit segment, offset by rising operational costs.