- Zerodha plans to enable investment in US stocks by the next quarter
- The company has received regulatory approval from GIFT City for this product
- Zerodha must partner with a US broker to offer US stock investments
Zerodha is planning to offer its customers the ability to invest in US stocks by next quarter, according to the company's CEO, Nithin Kamath.
Speaking at an Ask Me Anything session on Zerodha's official platform, Kamath explained that India's largest stockbroker by revenue has plans to allow investments in US stocks in the near future.
“A lot of people tagged me on social media and asked about the US investing thing. We are working on it, and we should have something in the next quarter. It is a product launch,” Kamath said.
Zerodha's CTO, Kailash Nadh, added that the company has received the necessary regulatory clarity from GIFT City, and it is only a matter of time before they roll out the product.
“It has been a long-pending thing. We now have the requisite regulatory clarity through GIFT City. We are trying to build a simple and seamless experience for users in the backend as well as in the frontend,” Nath said.
The statement from Zerodha's top management comes at a time when the stockbroker saw its profit and revenue decline for the first time in more than a decade. Its revenue declined as much as 15% following a regulatory crackdown, especially on Futures & Options (F&O) trading.
Offering investment opportunities in US stocks, therefore, could be a way to potentially tap into a niche group of investors.
However, this is not the first time Zerodha's Nithin Kamath has talked about offering investment options in US markets. He had previously done so in 2020, before admitting that COVID had delayed the process.
In order to offer investors the ability to invest in US stocks, Zerodha must partner with a US-based broker. INDMoney, for example, operates through Alpaca Broking, while 5Paisa operates through Vested.
Another potential hurdle for Zerodha could be the remittance cost associated with investing in US stocks, which could potentially deter investors from tapping into foreign markets.
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