According to a blog post by the company's co-founder and CEO Nitin Kamath, stock broking platform Zerodha reported a revenue of over Rs 8,370 crore and a profit of Rs 4,700 crore. This marks a significant increase from the operating income reported in FY2023 of Rs 6,875 crore and profit after tax of Rs 2,907 crore. The company has not yet officially released its annual report.

The data revealed by Zerodha indicates that more than half of its revenue has translated into profit. Kamath added that the company is already facing a challenge in revenue and profitability and is preparing for a significant revenue shortfall later this year.

The company has linked the expected fall in scale to the upcoming regulations by the Securities and Exchange Board of India (Sebi), which will do away with the volume-based transaction fee model of free equity delivery trades affecting all brokers, including Zerodha. SEBI's true-to-label circular will be activated on October 1, and Zerodha expects a 10% revenue decline due to the regulation.

The new basic service demat account (BSDA) limits set by the regulator will also impact Zerodha's annual maintenance charges (AMC). Kamath explained that the company can charge full AMC for customers with demat holding of Rs 10 lakh and above, up from the current limit of Rs 4 lakh. In addition to removing the fee for opening an account, this will result in a significant reduction in income.

Zendaya is confident that it will be able to cope with the slow period due to a small team, careful spending and strong finances. It now has 1,200 employees, but only a small fraction of them run the core business.

At this time last year, the headlines were about how Groove had surpassed Zerodha in terms of active users. However, there is no doubt that Zerodha is the best model in terms of its business model and profitability, and recent forays into its own passively managed mutual funds will also boost the numbers.