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Business Desk – Zerodha, which has shown crores of Indians the way to invest in the stock market, is now preparing to enter a new part of its business. The company has received SEBI approval on its application for Merchant Banking License.

However, its formal registration is yet to be completed. Once the registration is completed, Zerodha will not only be a company that provides investors the facility to buy and sell shares, but will also be able to help companies raising money through IPO to enter the market.

That is, the platform on which more than 1.6 crore customers invest in the stock market, now the same company will be seen doing business with companies in the IPO market as well. For Zerodha, this is not just a new license but is considered a big leap in business expansion.

Now Zerodha will enter IPO market also

Zerodha will enter the primary market i.e. IPO market through Merchant Banking. Merchant bankers help companies raise capital, prepare public issues and handle the entire IPO process. The move comes at a time when IPO activities are brisk in India. Zerodha already has a large retail investor base. Now the company is trying to establish its presence on the Investor Side as well as the Issuer Side.

According to reports, Zerodha Corporate Advisors had applied for Merchant Banking License with SEBI in April 2026. The application has been approved, but the formal registration process is yet to be completed.

Company moving forward through broking

Zerodha has been continuously expanding the scope of its business over the last few years. Stock Broking is still the main business of the company, but now the company has also stepped into areas like Asset Management, Loan and Private Investment.

The company has Zerodha Fund House, through which it is present in the Asset Management business. Along with this, a portfolio of low cost and passive investment products is also being prepared.

At the same time, the company is running the business of Loan Against Securities through Zerodha Capital. Zerodha co-founder Nitin Kamath had said earlier this year that the size of this business has crossed Rs 500 crore.

You can take loan by pledging shares and mutual funds

Under the Loan Against Securities facility, customers can take loan by pledging the shares and mutual funds held in their Demat Account. According to the company, its objective is to give customers the option of taking loans against their securities instead of expensive personal loans and credit card loans.

Zerodha is working on providing the facility of Loan Against Securities online also for customers having non-Zerodha Demat Accounts. That means the company does not want to be limited to just its existing customers.

Benefit from the power of 1.6 crore customers

Zerodha is among the largest Broking Platforms in India. The company has more than 1.6 crore customers. Billions of orders are placed every year through its trading platform.

This large customer base can now be important for the company's new business as well. Although Merchant Banking is not in the business of selling shares directly to customers, its deep market understanding and large retail investor network can help Zerodha strengthen its position in the capital markets.

Preparation for further big announcements

Nitin Kamath had told in the recent Business Update that Zerodha Capital, Zerodha AMC and Ditto are among the major businesses in Zerodha's investment portfolio. The company is also preparing to start investment facility in America and bring the facility of Mutual Fund Transactions on Kite Platform.

That means Zerodha's strategy no longer seems to be limited to just income trading. The company is trying to make its place in the entire value chain of the capital market including investment, loan, asset management and now IPO. The approval of SEBI for the application for merchant banking license is the next important step in this big strategy. However, the company can officially start this business only after the formal registration is completed.