Zerodha's Nikhil Kamath expects upto 20% drop in broking biz this year, eyes ₹10,000 crore in revenue for FY26: Report

Bengaluru, June 4, 2025 — In a candid assessment of the financial landscape and evolving investor behavior, Zerodha’s co-founder Nikhil Kamath has predicted a potential 15–20% decline in the company’s broking business for the current financial year. Despite this expected dip, Kamath remains optimistic about the fintech giant's long-term trajectory, revealing a bold target of ₹10,000 crore in total revenue for FY26, according to a report by The Economic Times.

This outlook highlights the dual nature of the current market—characterized by a temporary cooldown in retail investor enthusiasm but sustained optimism for structural growth and diversification in India’s capital markets.

Broking Slowdown Likely, But Not Permanent

Kamath attributed the projected slowdown in Zerodha's core broking revenues to cooling investor sentiment, particularly among first-time and small-ticket traders. “The euphoria of the post-COVID retail trading boom has clearly normalized,” Kamath noted. “What we’re seeing now is a reset in retail participation. And that’s healthy in the long term.”

Zerodha, India’s largest stockbroker by active clients, had benefited immensely from a retail trading surge during the pandemic years. However, with markets becoming more volatile and a lack of blockbuster IPOs on the horizon, trading activity—especially from novice investors—has seen a moderation.

A Strategic Shift Toward Diversification

While acknowledging the short-term pain, Kamath emphasized Zerodha’s multi-pronged strategy aimed at revenue diversification. The company has been expanding its offerings beyond broking through ventures in asset management (via Zerodha AMC), insurance (in partnership with Ditto), and investing in financial education.

“We’re laying the groundwork for sustainable, non-transactional revenue streams,” Kamath said. “The broking business may have hit its plateau in terms of growth rate, but the potential in adjacent segments is massive.”

Kamath estimates that a more diversified revenue mix could help the company double its revenue base in the next two fiscal years, reaching the ₹10,000 crore milestone by FY26.

Market Analysts See a Structural Transition

Market watchers concur with Kamath’s view on retail participation cooling. “The drop in Zerodha’s trading volumes mirrors a broader trend in the discount broking segment,” said Richa Desai, an equity research analyst at CapEdge Securities. “However, Zerodha’s capital-efficient business model, along with a forward-looking product roadmap, gives it a solid foundation to rebound.”

Zerodha’s flat-fee broking model disrupted India’s brokerage space more than a decade ago and helped democratize equity investing. But with over 12 million clients now on board, marginal user growth is slowing, and focus is shifting to deeper engagement and higher-value financial services.

₹10,000 Crore Ambition: A Calculated Bet

Reaching ₹10,000 crore in revenue would represent a near-doubling of current income levels, a feat Kamath believes is achievable with steady expansion in non-broking ventures and better monetization of the existing customer base.

“We don’t want to just grow for the sake of it,” Kamath said. “We’re focused on creating meaningful, long-term products that help people manage wealth better.”

The target also reflects Kamath’s belief in India’s long-term financial deepening. “The capital market ecosystem is maturing. Mutual fund SIPs, ETF investments, direct equity—these will grow as financial literacy improves.”

Investor Outlook: Short-Term Pain, Long-Term Potential

For investors and stakeholders in India’s financial services ecosystem, Kamath’s insights signal a maturation phase for retail investing. While the days of rapid-fire user acquisition and trading frenzy may be slowing, Zerodha’s pivot to long-term products could prove prescient.

“With the slowdown in the broking business, Zerodha’s future value will lie in how well it monetizes its large customer base through cross-sell and deeper engagement,” said Vishal Batra, a fintech venture advisor. “If they execute on their vision for asset management and insurance, the ₹10,000 crore revenue mark is entirely realistic.”

The industry will be closely watching whether Zerodha can scale its ecosystem strategy as efficiently as it disrupted the broking industry. Meanwhile, Kamath’s realistic appraisal paired with ambitious targets paints a picture of a company evolving from a startup success story to a financial powerhouse-in-the-making.