Advertisement
Tuesday, Oct 04, 2022
Outlook.com
Outlook.com

Why Zerodha Won’t Go For An IPO

Zerodha founder and CEO Nithin Kamath says in a Twitter thread that the digital brokerage platform doesn’t want to go for IPO.

Why Zerodha Won’t Go For An IPO
Why Zerodha Won’t Go For An IPO
outlookindia.com
2021-11-13T17:19:49+05:30

Days after the closing of initial public offerings (IPOs) of digital start-ups, from PolicyBazaar, Paytm to Nykaa, and others, founder and CEO of online trading platform Zerodha Nithin Kamath tweeted that his company does not want to go for an IPO in this bull market.

In a Twitter thread posted on November 12, he said, “Why not IPO @zerodhaonline, when you can potentially get ridiculous valuations? Firstly, we think an IPO is the beginning & not the end. As soon as you have lakhs of conservative retail investors on your cap table, the obligations go up exponentially.”

He points out that in the current market, companies are already getting priced to perfection based on all the future growth potential and for a stock to do well, a company needs to outperform. He further added, “As CEO, I dread to think how you can outperform the already really high expectations that growth companies have today.”

He said that the craze for IPOs is scary as the market is volatile and it is not possible to predict what the Nifty Midcap index can do in three years.

Talking to Outlook Money last month on the stock markets, Kamath had said, “Right now, we are probably overvalued as a market and we are pricing the future almost to perfection. Markets can’t really continue to go up like this. So, people should be putting small amounts of money consistently in the market over a longer period of time, so even if there are drawdowns in the market, they get a better average.” Read full story at Outlook Money.

Stressing on the fact that Zerodha is not looking at chasing an IPO, he mentioned in the tweet, “We have never set revenue or growth targets, always believed that if we can do what is right for the customer & if goddess of luck smiles, the rest will happen. Our core team dreads moving away from that philosophy to be in a chase all the time, which it will be after an IPO.”

Advertisement

Outlook Newsletters

Advertisement
Advertisement
Advertisement

Read More from Outlook

Lament Of Separation: Songs Of Habba Khatun, Last Queen Of Kashmir, Still Echo In Valley

Lament Of Separation: Songs Of Habba Khatun, Last Queen Of Kashmir, Still Echo In Valley

In happy times and sad, Habba Khatun’s sensuous songs make both young and old emotional. With the never-ending conflict bringing tragedies to every doorstep, Habba’s lyrics of separation amplify their mourning.

How Indian Laws Govern People’s Right To Love And Live

How Indian Laws Govern People’s Right To Love And Live

In India, only those relationships between a man and a woman are considered to be legitimate when there is a marriage between the two.

Kohli Quits Test Captaincy, Leaves Leadership Vacuum

Kohli Quits Test Captaincy, Leaves Leadership Vacuum

Virat Kohli, 33, had recently stepped down as India's T20I captain and was subsequently removed as the ODI captain.

UP Elections 2022: How Congress Is Harnessing Power Of 'Persecuted' Women To Counter BJP

UP Elections 2022: How Congress Is Harnessing Power Of 'Persecuted' Women To Counter BJP

A Mahila Congress leader, who is the face of the ‘Ladki Hoon, Lad Sakti Hoon’ campaign, however, has accused the party of anti-women bias after she was denied a ticket.

Advertisement