Zerodha's MTF bet pays off, touches Rs 3,000 crore in 6 months despite a bear market: Nithin Kamath

Time of India

03-06-2025

Zerodha's Margin Trading Facility (MTF) book has surged to ₹3,000 crore in just six months, serving as a revenue hedge during market downturns and boosting profitability. Enhancements in MTF features and client success are driving strong early traction.
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Discount brokerage Zerodha's Margin Trading Facility (MTF) book has grown to approximately Rs 3,000 crore within just six months of launch, despite nearly half that period being marked by bear market-like conditions. Founder and CEO Nithin Kamath shared the update on X (formerly Twitter), noting that although the company had long resisted entering the MTF space, it has now emerged as an effective revenue hedge—offsetting declines in both the options business and transaction charge revenues."Our MTF (Margin Trading Facility) book grown to Rs Rs 3,000 crores within 6 months of launch. Half the time, we were in a bear market-like conditions. By the way, the MTF component of a business, which we had resisted for so long, has acted as a revenue hedge for the business against a drop in options business and a drop in transaction charge revenue," the tweet said.Kamath said that the company's clients are currently sitting on a combined profit on their MTF position. Calling it a "good news", he said that he doesn't know if it will eventually be like this, but at least for now, the business is profitable."The good news is that our clients are sitting on a combined profit on their MTF position. I don't know if it will eventually be like this, but at least for now, they are profitable," Kamath said.He said that the revenue cushioning provided by MTF has helped the company to maintain brokerage rates and depository participant (DP) charges at pre-regulatory action levels, preserving client economics even during industry-wide pricing stress.With strong early performance and tangible business benefits, MTF is fast becoming a key lever in the firm's diversified revenue strategy.Kamath said that the company has improved the MTF feature on Kite by facilitating easy converting of MTF positions to delivery; increasing limits for trade up to Rs 5 crore per stock and Rs 25 crore per account. The company allows MTF for over 1,300 stocks with up to 5X leverage.Through Kite, the users can place GTT and AMO orders.GTT is 'Good Till Triggered" which is a type of order that allows traders to set up buy or sell orders that will only be executed when a specific price trigger is met. This means the order remains active until the trigger condition is reached, unlike regular orders which may expire if not filled during the trading day.AMO is 'After Market Order' which allows investors to place buy or sell orders outside of regular trading hours. These orders are then executed the next trading day usually during the pre-market session.Also Read: Zerodha AMC's silent success: AUM worth Rs 6,400 crore in 18 months, LIQUIDCASE ETF emerges as a retail hero