Groww Stock Rises 7% Following BofA's 'Buy' Rating Initiation
Detailed Analysis
Groww's Parent Company Sees Surge in Share Price Following Fresh Brokerage Coverage
Shares of Billionbrains Garage Ventures, the parent company of investment platform Groww, experienced a significant increase in trading value on Wednesday following the initiation of coverage by Bank of America Securities. The stock was trading at Rs 209.74, representing a gain of Rs 15.03 or 7.72 percent on the National Stock Exchange (NSE).
According to a report by CNBC-TV18, Bank of America Securities has assigned a 'Buy' rating to Billionbrains Garage Ventures with a price target of Rs 235 per share. This recommendation suggests a potential upside of approximately 21 percent from the company's last closing price. The brokerage firm's analysis highlights Groww's favorable position to capitalize on the strong retail investing trends in India, predicting a revenue compound annual growth rate (CAGR) of 30 percent between fiscal years 2026 and 2028.
The report also emphasizes the company's robust profitability profile, with scope for further gains driven by operating leverage. Bank of America Securities expects the earnings before interest, taxes, depreciation, and amortization (EBITDA) and profit after tax (PAT) margins to expand to 67 percent and 52 percent, respectively, by fiscal year 2028. The brokerage firm has valued the stock at 39 times its estimated earnings for fiscal year 2028, while flagging near-term risks such as weak capital market conditions and the expiry of the six-month lock-in period.
This latest call from Bank of America Securities adds to the growing list of positive views on Billionbrains Garage Ventures. Last month, JPMorgan initiated coverage with an 'Overweight' rating and a target price of Rs 210. UBS had earlier started coverage with a 'Neutral' rating and a target of Rs 185.
| Brokerage Firm | Rating | Target Price | | --- | --- | --- | | Bank of America Securities | Buy | Rs 235 | | JPMorgan | Overweight | Rs 210 | | UBS | Neutral | Rs 185 |
Investor Takeaway
Investors should consider buying Groww stock due to its potential upside and strong retail investing trends in India.
