At a Glance
Zaggle’s software-meets-spend-management business is quietly scaling behind the scenes – with a 5Y profit CAGR of 88%, growing client base (Truecaller, Aster, Tech Mahindra), and 60+ acquisitions/partnerships. But is 64x P/E the price for prepaid nirvana, or just fintech FOMO?
1. 🧾 WTF Do They Even Do?
- Zaggle operates at the intersection of SaaS + Fintech + Prepaid Instruments
- B2B-only platform – no consumer banking, just business use-cases:
- Expense Management
- Employee Benefits
- Corporate Travel Solutions
- Loyalty Programs & Rewards
- Issues co-branded Prepaid Cards via partnerships (like YES Bank, NSDL)
- Competes with: Happay, EnKash, Fyle, Zeta, ITILITE, but also fresh fintech upstarts
🎯 Clients?
- PhysicsWallah
- Indus Towers
- Honasa (Mamaearth)
- Thomas Cook
- Tech Mahindra
- Aster DM Healthcare
- Truecaller
…and the list keeps growing.
2. 💸 Financials – Profit, Margins, ROE, Growth
| Metric | FY21 | FY23 | FY25 |
|---|---|---|---|
| Revenue (Cr) | ₹240 | ₹553 | ₹1,303 |
| Net Profit (Cr) | ₹19 | ₹23 | ₹87 |
| EBITDA Margin | 12% | 9% | 9% |
| ROE (%) | — | 9.6% | 10% |
| 5Y Profit CAGR | — | — | 88% |
| Stock CAGR (1Y) | — | — | +40% |
📈 Sales tripled in 2 years, profits up 4x
📉 But margins haven’t scaled much (OPM stuck at 9%)
3. 💰 Valuation – Is It Cheap, Meh, or Crack?
- CMP: ₹420
- P/E (TTM): 64x
- P/B: 4.5x
- Mcap: ₹5,632 Cr
- EPS (FY25): ₹6.52
- Growth is real, but… it’s pricing in perfection.
🧠 EduInvesting FV Range:
cppCopyEditBase Case (35x EPS) = ₹230
Mid Case (45x EPS) = ₹295
Growth Buff (55x EPS) = ₹360
🎯 FV Range: ₹230 – ₹360
It’s running a bit ahead of itself, but not absurd in a SaaS-hungry market.
4. 🔥 What’s Cooking – News, Triggers, Drama
🛒 Acquisitions Galore:
- 100% stake in Greenedge (₹27 Cr) – loyalty programs
- 100% stake in Dice (₹123 Cr) – corporate travel SaaS
- Stake in Effiasoft (₹41 Cr) – billing & GST SaaS
- Deal with Mobileware – UPI/Neo Banking backend
📄 Deal Wins:
- Grant Thornton – channel partner for Zaggle platforms
- Aster DM, Truecaller, Omega, Tech Mahindra, Thomas Cook, Wonder Home Finance – onboarded for expense solutions
💥 Trigger: If integration of acquired SaaS products works, margins could finally scale
5. 📊 Balance Sheet – How Much Debt, How Many Dreams?
| FY25 | ₹ Cr |
|---|---|
| Net Worth | ₹1,247 Cr |
| Total Borrowings | ₹16 Cr (basically nil) |
| Total Assets | ₹1,308 Cr |
| Cash | ~₹130 Cr (post IPO + internal accruals) |
✅ No debt trap
⚠️ Aggressive inorganic growth = execution risk
6. 💵 Cash Flow – Sab Number Game Hai
| FY25 Cash Flow | ₹ Cr |
|---|---|
| Operating CF | +₹20 Cr ✅ |
| Investing CF | -₹486 Cr (acquisitions + capex) ❌ |
| Financing CF | +₹496 Cr (IPO + equity raise) |
| Net CF | ₹+30 Cr |
🧯 Acquisitions are guzzling cash – but company still sitting on some fuel
7. 📊 Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROCE | 13% ✅ |
| ROE | 10% ⚠️ |
| OPM | 9% ⚠️ |
| Working Cap Days | 100 ❌ |
| Cash Conversion Cycle | 60 days ✅ |
😐 Needs better efficiency metrics to justify the “tech” tag
8. 📈 P&L Breakdown – Show Me the Money
- FY25 Revenue: ₹1,303 Cr
- Profit: ₹87 Cr
- EPS: ₹6.52
- Dividend: 0% (no payout, all reinvested)
- Most growth coming from software-led services, not float income
📌 Employee costs rising in sync with client onboarding
📌 Margin expansion will come only after SaaS products mature
9. 📐 Peer Comparison – Who Else in the Game?
| Company | Revenue | OPM | ROCE | P/E | Mcap |
|---|---|---|---|---|---|
| Zaggle Prepaid | ₹1,303 | 9% | 13% | 64x | ₹5.6K Cr |
| Affle 3i | ₹2,266 | 21% | 16.8% | 72x | ₹27K Cr |
| Netweb Tech | ₹1,149 | 13.9% | 32.5% | 89x | ₹10.2K Cr |
| Cyient | ₹7,360 | 15.5% | 16.5% | 23x | ₹14.3K Cr |
| Inventurus Knowl | ₹2,663 | 28.9% | 27.2% | 55x | ₹27K Cr |
🧠 TLDR: Zaggle has the growth, but not yet the margins or ROEs to match peers
10. 📎 Misc – Shareholding, Promoters, Institutions
- Promoter Holding: 44.21% (up from 40% last quarter) ✅
- FIIs: 8.4%
- DIIs: 13.2%
- Public: 34.1%
- Shareholders: 1.06 lakh 🚀 retail ka pyaar
📌 High FII churn – in and out quickly
📌 Promoters increasing stake = positive signal
11. 🎭 EduInvesting Verdict™
Zaggle is what you get when a SaaS startup walks into a fintech bank lobby with prepaid cards and says: “Ab business kharcha bhi manage karwao, tech se.”
It’s not a unicorn, but the growth story is legit.
The stock valuation assumes that it will scale like Happay, spend like Concur, and integrate like SAP. Bold bet.
✅ Good clients
✅ Clean balance sheet
✅ M&A strategy shows vision
❌ Needs to prove margin consistency + stickiness
💡 Verdict:
Zaggle isn’t a fintech fraud.
But at 64x earnings, it’s a bit Zaggernometry at this stage.
🎯 EduInvesting FV Range: ₹230 – ₹360
Tags: Zaggle Prepaid, Zaggle SaaS Fintech, Zaggle IPO Analysis, Zaggle Acquisitions, Zaggle Stock Valuation, Expense Management India, EduInvesting
✍️ Written by Prashant | 📅 11 July 2025
