Zerodha Interview Questions, Process, and Tips

Q1. Tell me about yourself in under 1 min.
Add your answer
Q2. What kind of legacy you would like to leave and to which fictional/historical character, the legacy resembles?
Add your answer
Q3. Elaborate on a project you did while working with Praxis. Brief discussion on hobbies.
Add your answer

A rental furniture store is experiencing loss in market share. Help the client on the steps ahead.
[Please note that I stands for Interviewer and C stands for Candidate]

C: Where does the store operate? What product variants it sells (high ticket items/small etc.).

I: Delhi, sells both high- and low-ticket items.

C: What kind of business model the firm has? - rental charge, duration, procurement from etc.

I: 3 possibilities - Either customer pays monthly charge as per use, customer pays monthly charge for 2-3 months and then buys the furniture at lumpsum amount, customer pays monthly charge for a year or so and is handed over possession of furniture.

C: What is current market share, How much decline in market share? Is the decline in any SKU? who are competitors?

I: Market leader currently with 40% share, fragmented market with new entrants. Decline is nonspecific.

C: Structure- Market share of this firm will be a function of #customers* avg spend per customer (further divided into - frequency of purchase* avg ticket size per item). So, either one of these have been affected or a combination that led to fall in market share. I started elaborating reasons for all 4 buckets. # customer falling due to customers switching to competitors. This can be because of better customer discounts, better user interface for purchasing, awareness should not be an issue as already market leader, better financing facilities like EMIs etc.

I: Firm Y is giving higher discounts and is also providing attractive EMI options for high ticket items. Additionally, they are pushing the lumpsum model rather than other 2. Can you tell why would they do it?

C: Reason 1- Lower working capital for procuring new furniture for sale,
Reason 2- Customers like to rent brand new furniture and by pushing selling of the same, they can keep fresh stock for rental customers and increase value proposition.

I: What recommendations you would like to give?

C: The firm has basically 2 types of customers - Paying Guests, usually millennials staying in Delhi for work / university - expect vibrant and sleek furniture. Conservative customers who like to try high ticket furniture first and then buy if it suits their ambience, such items are also lower priced than fresh product.

C: After doing cost benefit analysis, we can provide discounts like competitors and also provide new services like home interior services for vibrant houses as target audience is millennials.

A low-cost airline player has xx revenues. Its non-fuel costs were 2x its fuel costs. PAT margin was y%. The fuel costs have recently doubled. What is new profitability. What should they do to maintain initial PAT margins?
[Please note that I stands for Interviewer and C stands for Candidate]

C: Calculated new PAT margin by finding initial costs, then doubling fuel costs. Clearly stated the assumption that revenues have remain unchanged, i.e., price of ticket and neither #customers have changed to calculate new PAT margin. In order to maintain initial PAT margins, either revenues should increase, or costs should go down. Should I consider both possibilities?

I: Focus on increasing revenues only.

C: I would like to calculate by how much % we need to increase revenues considering costs cannot increase to maintain same PAT margin. Revenue = #customers * avg ticket size of a flight * avg frequency of travel #customers: Increase occupancy rates in non-peak times (when its usually 30-40%) by reducing prices a bit and better marketing. Also, newer routes (via cities) can be done to cater to newer locations for higher occupancy rates.

I: We do not want to incur any costs on marketing, routes are already at optimal and we can consider the occupancy point. Let us say 3% revenues increase due to it. (we needed ~14% increase)

C: For increasing avg ticket size: We can provide additional meals or newer supplementary services such as OTT apps streaming etc.

I: No, we want to maintain our image as low-cost carrier only.

C: The average frequency of travel can increase by more competitive pricing if possible. New routes to cater to newer customers is not an option as already established.

I: What recommendations you will give to this firm? Given we are 2nd in market currently and 1 out of only 2 players who are profitable in the industry.

C: Not much can be done during this time to increase PAT margins. Our advantage lies in sheer profitability which the firm is still making as high fuel costs will affect other players too, and more severely, given they are already loss making. This opens new doors to possible mergers in future and increase diversification of airlines leading to higher revenues and higher future PAT margins.

It was a coding test. After clearing it, I had 2nd round of coding test where they asked me solve. The question was of histogram problem from dsa.

Q1. It was technical round where interviewer asked me to solve the histogram problem which I found very tough.
Add your answer