CCI clears Groww’s bonus share issue, ends founders’ special rights ahead of IPO

The Competition Commission of India has approved a proposal by stock broking platform Groww to issue bonus shares to its existing investors.

This move comes as Groww, officially known as Billionbrains Garage Ventures Private Ltd., prepares for its Initial Public Offering and plans to remove the special voting rights previously held by its founders.

Regulatory nod for key changes

The CCI's approval means certain shareholders will acquire additional voting rights, and Groww will issue bonus compulsorily convertible preference shares to all its existing equity investors.

These investors include well-known venture capital firms such as Peak XV, Ribbit Capital, YC Holdings, Tiger Global and ICONIQ. The founders’ differential voting rights will also be collapsed, which effectively places all shareholders on a more equal footing.

Investor background and company domicile

Peak XV, formerly known as Sequoia Capital India, focuses on early-stage startups across India and Southeast Asia. Ribbit Capital invests in emerging financial technology companies worldwide, while YC Holdings is part of Y Combinator, a startup accelerator known for backing global tech innovators.

Tiger Global has a long history of funding successful consumer technology ventures, and ICONIQ invests in private equity through its global network.

Groww offers an online platform and mobile app that helps users invest in stocks, mutual funds and other financial products. The Bengaluru-based company recently moved its domicile to India, completing a process that began with filings before the National Company Law Tribunal in 2023.

Plans for an upcoming IPO

Groww is in talks to raise around $200 million ahead of its planned IPO, at a possible valuation of $6 billion to $8 billion. It has already raised nearly $400 million from prominent backers, reaching a valuation of $3 billion in 2021.

The company reported revenue from operations of Rs 3,145 crore in the fiscal year 2024, but it also booked a net loss of Rs 805 crore. The loss was largely attributed to a one-time tax payment of Rs 1,340 crore linked to moving its base to India.