In the financial world, Zerodha is making waves with its jaw-dropping value of Rs 30,000 crore, which translates to about $3.61 billion. This incredible revelation comes directly from the top—the Co-Founder and Chief Executive Officer (CEO) of Zerodha, Nithin Kamath, shared this exciting news on X (formerly Twitter).
Kamath let us in on how they figure out this valuation—it's usually a calculation of 10-15 times the company's earnings, specifically the Profit After Tax (PAT). "We value ourselves in the range of 10 to 15 times our earnings (PAT)," mentioned Kamath. This has been their consistent approach during various buyback dealings with the founders and the team.
Fresh and exciting updates have followed Zerodha's release of its financial report for the year 2022-23. The company's revenue soared impressively by 38.5%, reaching a total of Rs 6,875 crore in the past fiscal year. The profits were equally outstanding, surging by 39% to hit Rs 2,907 crore in FY23. Even the profits saw an impressive surge, growing by 39% and reaching Rs 2,907 crore in FY23. A clear testament to company's robust performance, considering its revenue of Rs 4,964 crore and profit of Rs 2,094 crore in FY22. It's indeed a remarkable growth trajectory for Zerodha.
Kamath is optimistic about Zerodha's future growth, anticipating a significant 10-15% growth given the current market conditions. He's well aware of the potential for downturns but remains confident in the company's growth, given the scale they operate at.
When it comes to diversification strategies, Kamath shed light on Zerodha's move into mutual fund schemes through Zerodha Asset Management Ltd., a venture launched on September 5. This strategic step is all about broadening their financial portfolio. Kamath stressed that diversification, combined with strategic initiatives like Rainmatter, public holdings, and significant investments in various areas, including the AMC business ZerodhaAMC, insurance advisory, and loans against securities, will strengthen the company's long-term growth prospects.
Even though these different ventures don't bring in a lot of money right now, Kamath believes they'll pick up speed and become vital for Zerodha's growth. Zerodha's special way of calculating its value and plans for growth shows it's a big player in finance that's always changing and growing. Stay tuned for more such insightful updates!