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Billionbrains Garage Ventures, the parent company of stockbroking platform Groww, saw its equity derivatives revenue decline 14.3% quarter-on-quarter (QoQ) in the September quarter of FY27, with the company attributing most of the fall to SEBI’s new Closing Auction System (CAS). In its quarterly results, Groww said the decline was in line with the trend seen across the industry following the rollout of CAS on August 3, 2026. The system changed the way closing prices are determined for stocks eligible for futures and options (F&O) trading. Under CAS, exchanges conduct a closing auction to determine the final price of eligible stocks. The change has affected trading volumes as market participants adjust to the new mechanism. The new system also creates a gap between cash-market and derivatives trading hours. Continuous trading in eligible stocks ends at 3:15 PM, while equity derivatives continue trading until 3:40 PM. This can make it harder for traders to hedge their positions and manage risk during the closing period. The impact comes even as Groww reported growth in its overall business. Its parent company posted a consolidated net profit of Rs 725.6 crore in Q2 FY27, up 54% year-on-year, while revenue rose 44% to Rs 1,541 crore from Rs 1,071 crore a year earlier. The share of equity derivatives in Groww’s revenue also declined to 45% in the September quarter from around 57% a year earlier. Meanwhile, SEBI has proposed changes to the derivatives settlement mechanism to address concerns around CAS. The regulator is considering separating derivatives settlement prices from the closing auction price, a move that could help normalise trading activity if implemented. The extent of any recovery in derivatives revenue will depend on the final regulatory framework and how market participants adapt to the changes.
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