The company PeepalCo, which runs the CoinSwitch brand, announced the release of Lemonn, a new stock investing app, on Tuesday, April 2, 2024, to expand its product line.

With this launch, PeepalCo enters the stock broking market. It will have its own managing and operations teams and function as a distinct business division.

“The focus of Lemonn would be new or young investors who are getting into the stock market for the very first time or very early investors. It will help them discover the right stocks and help make their decisions on which stocks to buy when to enter (the market), and how much to invest. There are a bunch of products lined up, but we will cater to the full suite, including futures and options, and the ability to invest in IPOs and mutual funds. Those will be built on top of this platform,” said Ashish Singhal, co-founder and group chief executive officer (CEO) of PeepalCo group.

The firm is offering zero trading brokerage for the first three months and no fees for account opening. Subsequently, it will introduce a flat fee structure for its users.

It is exploring other avenues on fee structures such as subscription models, and annual fees for customers, the company’s executives said during a virtual media roundtable.

The platform currently supports investments in equity with plans to foray into other investment classes in the future.

The app will help new investors in discovery and decision-making by providing expert ratings for more than 200 stocks by aggregating advisory reports from analysts. It will also provide zero-trading brokerage for the first three months. The company is considering multiple revenue models including charging its users a flat broking fee or annual subscription charges after the first three months.

Company executives added that their crypto trading platform CoinSwitch and the recently launched Lemonn will function independently from one another.

While it has plans to showcase the stock broking service to its current user base of over 20 million, Singhal said Lemonn will be a separate app and will adhere to Know Your Customer (KYC) and stock broking guidelines laid out by the market’s regulator.

“PeepalCo is our parent entity which provides tech product services to both these branches which is CoinSwitch for crypto and Lemonn for stock broking. Both are completely independent companies represented by their independent management, decision making and operations. There is no intermingling between these products,” Singhal elucidated.

CoinSwitch has raised USD 302 million to date, according to data from market intelligence platform Tracxn. Singhal explained the company is currently well-funded with a runway of five years.

“We have five plus years of runway to grow both brands together. Once Lemonn reaches a level of success, we will hope to go to the market and see if we should raise a round separately,” he added.

Zerodha, one of the country’s top stockbrokers, revolutionised stockbroking when it charged a flat brokerage per trade, as opposed to a per-lot brokerage charged by the then-incumbent brokers when it entered the market more than a decade ago. Its competitor and another unicorn startup Groww simplified the process of buying and selling stocks, with an easy-to-use app.

In FY23, PeepalCo reported around 82% decline in its net revenue from INR 248.6 crore a year ago to INR 45.6 crore. In comparison, India’s largest brokerage firm in terms of active client volumes, Zerodha’s operating revenue in FY23 was INR 6,875 crore, while its net profit stood at INR 2,909 crore. Zerodha had over 6.5 million daily active users at the end of 2023.

Article Sources – Mint, Outlook