Zero-Brokerage No More? Zerodha’s Future Hinges on Regulatory Storms

India’s largest brokerage, Zerodha, may soon end its hallmark zero-brokerage model for equity delivery trades, warns CEO Nithin Kamath, as regulatory headwinds threaten its core business.

Key developments from Kamath’s statement:

1. Zerodha’s Q2 FY2025 brokerage revenue dropped 40 percent year-over-year due to market fatigue and policy changes.
2. Proposed ban on weekly options could severely impact Zerodha’s options-driven revenue stream.
3. Regulatory shifts include increased Securities Transaction Tax, reduced weekly expiries, and removal of exchange fee rebates.
4. Kamath hinted that charging for delivery trades may become necessary to sustain operations.
5. Despite setbacks, Zerodha remains financially robust with zero debt, ₹13,000 crore net worth, and a ₹5,000 crore margin trading book.

Kamath emphasized long-term resilience over short-term optimization, but acknowledged that a business pivot may be inevitable.

Sources: Times of India, Business Standard, Business Today, Zee Business.