Zerodha Secures SEBI Approval for Category-I Merchant Banking Application
The approval opens the door to Zerodha managing IPOs, rights issues and other equity raises pending formal SEBI registration.
Overview
- Zerodha Corporate Advisors applied for Category-I merchant banker registration on April 27, 2026 and media reports on September 2 say SEBI has approved that application, though final registration remains pending.
- A Category-I licence would let Zerodha manage initial public offerings, follow-on offers, rights issues and provide capital-raising advice to companies, functions that differ from its existing retail broking role.
- SEBI raised the financial entry bar for new Category-I merchant bankers in January 2026 to a Rs 50 crore minimum net worth and Rs 12.5 crore liquid net worth, making new approvals notable for meeting tougher standards.
- Zerodha has been diversifying into asset management, lending and GIFT City broker-dealer activity, and winning this approval would extend the firm’s reach from retail investors to corporate clients seeking capital.
- If Zerodha completes formal registration, competition for equity capital market mandates could increase as IPO activity recovered in July–August 2026 and companies seek advisers to manage fresh listings.