Groww: These four major and early investors selling nearly Rs 4,800 cr stake; shares plunge

Four major investors likely sold their 68% stake in the financial technology firm Billionbrains Garage Ventures Ltd (Groww) today. Investors namely Peak XV (Peak XV Partners Investments VI-1), Sequoia (Sequoia Capital Global Growth Fund III - US/India Annex Fund), Y Combinator (YC Holdings II, LLC) and Ribbit (Ribbit Capital V LP, Ribbit Cayman GW Holdings V, Ltd and GW-E Ribbit Opportunity V, LLC) launched block deals. These shareholders likely sold 26.84 crore shares worth Rs 4,750.68 crore at around Rs 177 apiece.

The stake sale led to a 7% crash in Groww stock. The stock slipped to Rs 180.15 on Tuesday against the previous close of Rs 193.70. Market cap of the stock broking firm slipped  to Rs 1.16 lakh crore. 

The correction on the brokerage counter came amid news of Rs 4,750 crore worth block deals. After the IPO lock expiry, a total of 418.19 crore Groww shares amountinng to a 68 per cent of its outstanding equity, became eligible for trading from today.

Groww shares logged the highest turnover (Rs 524.74 crore) after 2.86 crore shares changed hands on BSE today. 

According to reports, the shares on offer accounted for 4.3 per cent of the total outstanding equity, with the deal likely to be executed at an 8.5 per cent discount to the NSE's Monday closing price of Rs 193.52. 

Kotak Securities Limited was said to be the placement agent for Peak XV, Sequoia and Y Combinator. On the other hand, JP Morgan India Private Limited is the placement agent for Peak XV, Sequoia and Ribbit, as per Business Today sources. The transaction will be through vendor sale i.e. by way of one or more share sales on the screen-based trading platform of NSE.

According to the latest shareholding data available on the exchanges, Peak XV Partners Investments owned a 16.88 percent stake in Groww, while two entities linked to Y Combinator owned 11.25 percent and two entities linked to Ribbit Capital hold 12.36 percent. Sequoia Capital Global Growth Fund III, also a selling shareholder, held a 1.57 percent stake.

Under Sebi rules, non-promoter pre-IPO shareholders are subject to a mandatory six-month lock-in period following a firm’s stock market debut.