Financial Analysis Summary: Zaggle Prepaid Ocean Services Limited
Board Meeting Date: August 14, 2025
Quarter Ended: June 30, 2025 (Q1 FY26)
Previous Quarter: March 31, 2025 (Q4 FY25)
Same Quarter Previous Year: June 30, 2024 (Q1 FY25)
Financial Year Ended: March 31, 2025 (FY25)
Currency: ₹ Million

1. Auditor’s Note

• Type: Limited Review Report by MSKA & Associates (Statutory Auditors)
• Conclusion:
  • No qualifications, concerns, or issues reported.
  • The review was conducted as per applicable standards (SRE 2410).
  • The auditors state nothing has come to their attention indicating material misstatements or non-compliance with Ind AS and SEBI regulations.
• Subsidiary & Associate:
  • Included in consolidated results; subsidiary’s interim financials show a small net loss (₹3.70 million) and comprehensive loss (₹4.06 million).
  • Associate’s financials reviewed by other auditors; no adverse remarks.
• Actionable: No auditor qualifications or concerns.

2. Financial Performance

Margins (Consolidated Q1 FY26):

• EBITDA proxy (Profit before tax + Finance costs + Depreciation):
  = 347.46 + 10.79 + 70.21 = ₹428.46 million
• EBITDA Margin = 428.46 / 3,436.71 = ~12.47%
• Net Profit Margin = 261.05 / 3,436.71 = ~7.6%

3. Detailed Notes / Management Commentary

• Accounting Standards: Results prepared as per Ind AS and SEBI guidelines.
• IPO Fund Utilisation:
  • Total IPO proceeds: ₹3,621.60 million
  • Utilised: ₹2,733.73 million
  • Unutilised: ₹887.87 million (invested in bank deposits and monitoring accounts)
  • Major utilisation towards customer acquisition & retention (₹2,371.68 million) and technology/product development (₹143.81 million).
• Qualified Institutions Placement (QIP):
  • Raised ₹5,948.41 million (gross), net ₹5,741.37 million after expenses.
  • Utilised ₹836.78 million for borrowings repayment, strategic investments (acquisition in associate), and corporate purposes.
  • Unutilised ₹4,904.60 million (mostly in bank deposits and ₹360 million advance for share acquisition).
• Employee Stock Options: 30,277 shares allotted during Q1 FY26 at ₹233 per share.
• Segment Reporting:
  • Revenue split by business segment (consolidated):
    • Program fee: ₹1,454.78 million (Q1 FY26)
    • Propel platform revenue / Gift cards: ₹1,759.04 million
    • Platform fee / SaaS / Service fee: ₹105.83 million
  • Geography: Entire revenue from India.
  • No allocation of common costs/assets/liabilities across segments; performance assessed at Group level.
• Subsidiary & Associate:
  • Subsidiary: Span Across IT Solutions Pvt Ltd
  • Associate: Mobileware Technologies Pvt Ltd
• No changes in accounting policies or material adjustments reported.
• Figures for Q4 FY25 are balancing figures between audited FY25 and reviewed 9-month results ending Dec 31, 2024.

4. Segment Information

• All revenue is domestic (India).
• No segment-wise profit or asset allocation disclosed.

5. Capex, Projects, and Corporate Activity

• Capital Expenditure: Not explicitly disclosed in the results.
• Projects: No specific ongoing/planned projects detailed.
• Investments:
  • Strategic investment in associate via QIP proceeds.
  • ₹360 million advance payment towards acquisition of shares (likely associate or strategic investment).
• Borrowings: Partial repayment/pre-payment using IPO and QIP proceeds (₹168 million from IPO, ₹836.78 million from QIP).
• Employee Stock Options: 30,277 shares allotted in Q1 FY26.
• No impairments, write-downs, writebacks, or restructuring efforts disclosed.

6. Standalone vs Consolidated

• Both standalone and consolidated unaudited financial results for Q1 FY26 provided and reviewed.
• Financials are broadly aligned with minor differences due to consolidation adjustments and share of associate profits.
• Consolidated includes subsidiary and associate results.
• No material divergence between standalone and consolidated profitability or revenue.

Summary for Investment Analysis Team

Actionable Insights:

• The company shows strong YoY growth in revenue and profitability, supported by recent capital raises (IPO and QIP).
• Significant cash reserves from unutilised QIP proceeds provide financial flexibility for strategic investments or debt reduction.
• Margins are stable; however, QoQ dip in revenue and profit should be monitored for seasonality or operational issues.
• Segment revenue concentration in gift cards and program fees indicates core business focus; no international revenue exposure.
• No auditor concerns or accounting issues, supporting reliability of reported numbers.
• Employee stock option exercises indicate ongoing employee incentives aligned with company growth.

Recommendation: Monitor utilisation of large unutilised QIP funds and progress on strategic investments. Watch quarterly trends for revenue/profit recovery post Q1 dip. No immediate red flags from financials or audit reports.