Motilal Oswal flags 25% upside potential for Groww as regulatory concerns fade

Motilal Oswal has turned bullish on Groww, projecting 25 per cent upside potential for the fintech platform's shares as regulatory uncertainties that have weighed on valuations begin to dissipate. The brokerage believes Groww is positioned to maintain robust earnings growth momentum in coming quarters, supported by continued expansion of its market footprint in retail investing and financial services.

The analyst points to three key growth drivers for the platform. Market-share gains in its core investing segment remain steady, with Groww consolidating its position among India's leading retail investment platforms. The company is also deepening monetisation of its expansive customer base through multiple service layers, moving beyond transaction-based revenues to build a more diversified income model.

Particularly noteworthy is the increasing contribution from margin trading financing (MTF), credit products, and other financial services. These higher-margin businesses are expected to drive profitability improvements as they scale, offsetting the competitive pressures in brokerage fees. The diversification into adjacent financial services addresses a key growth constraint that has previously limited fintech valuations.

The regulatory clarity expected ahead is likely to provide confidence to institutional investors, many of whom have maintained cautious positions pending resolution of compliance concerns. As Groww demonstrates sustained execution across its business pillars and regulatory risk recedes, analyst expectations for re-rating have strengthened considerably.