Groww Planning to Enter the Wealth Management Industry with Unit 'W'

According to a media report, IPO-bound Groww will begin providing wealth management services to wealthy clients under the name W through a distinct arm. The online investment platform, which already provides investment options including equities, mutual funds, and exchange-traded funds (ETFs), will be expanding under a separate organisation for the first time. As per the report, W would provide 15 million wealthy customers alternative investment funds (AIF) and portfolio management services (PMS) through its mutual fund and broking operations. Although they did not specify when the new entity will begin, it is expected to happen soon.

Allowing Much Needed Access to Investors

A wider range of elite individual investors would have access to private markets, including startup investments and other exclusive asset classes that are generally more difficult to invest in, thanks to Groww's recent action. Groww is also preparing an acquisition to boost the fledgling wealth management company's expansion, with the goal of creating an omnichannel presence for HNI customers. As it gets ready for an initial public offering (IPO), Groww's plans for the wealth management industry highlight its intention to go beyond retail investment and serve wealthier clients. Groww, which is backed by Peak XV Partners, is negotiating with investment banks for an initial public offering (IPO) that may value the firm at $6–8 billion, more than doubling the 2021 estimate of $3 billion, according to a report published by a prominent media outlet on January 14. Groww would become the first significant company in the wealthtech industry in India to go public as a result.

Groww’s Past Present and Future

According to the most recent data from the National Stock Exchange, Groww started out as a direct mutual fund investing platform before branching out into stock trading and becoming India's largest broking app with over 12 million active traders, surpassing both Angel One (7.6 million) and Zerodha (8.1 million). In addition to offering credit through a non-banking financial organisation, Groww also manages assets. With W, Groww will have a closer rivalry with companies that serve wealthy investors, like Sanctum Wealth and 360 One Wealth (previously IIFL Wealth).

Additionally, the move coincides with an increase in wealth creation in India that is creating new prospects for wealthtech businesses that are sector-focused. Groww shifted its parent company back to India from the US in order to get ready for its India IPO. Based on a recently determined fair market value, the company paid the US government INR 1,340 crore ($160 million) in taxes. Its stated loss last year was influenced by this tax payout, which accounted for more than 30% of its most recent $3 billion valuation.