DiGiSPICE Technologies Limited — Q2 FY26 earnings call

Call held 17 Nov 2025

Management summary

DigiSpice Technologies reported a strong Q2 FY26, with revenue growing 14% YoY to ₹124 crores and PAT reaching ₹7.2 crores, marking its second consecutive profitable quarter. The company's asset-light model contributed to an annualized ROCE of 12.8% and ROI of 31.4%. Key growth drivers included a 2.6x YoY increase in credit distribution and expansion of its agent network to 1.6 million BC points. However, the collections segment faced an 11.9% decline in GTV due to MFI industry degrowth and margin pressure.

Highlights

  • Q2 FY26 Revenue at ₹124 crores, up 14% YoY.

  • Q2 FY26 Gross Margin at ₹52 crores, up 20% YoY.

  • Q2 FY26 PAT at ₹7.2 crores, marking two consecutive quarters of profit.

  • Annualized ROCE at 12.8% and ROI at 31.4% for H1 FY26.

  • Credit distributed grew 2.6x YoY to ₹176 crores in Q2 FY26.

Concerns

  • Collections GTV saw a decline of 11.9% due to degrowth in the MFI industry.

  • Margin pressure in the commoditized collections segment.

Key financials

  1. Revenue ₹124 Cr +14%YoY
  2. Gross Margin ₹52 Cr +20%YoY
  3. EBIT ₹10.6 Cr +2,900%YoY
  4. PAT ₹7.2 Cr
  5. Annualized ROCE 12.8%
  6. ROI 31.4%

What they filed

Q1 FY27: revenue down 12.9%, net profit down 4.9% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue109 113 117 124 125 +14%109 −3%107 −8%108 −13%
EBITDA-3 -2 1 6 7 +333%6 +472%1 +69%9 +34%
Net profit-7 -20 -12 7 7 +198%2 +112%3 +123%7 −5%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Order book

low confidence
The company's business model is based on transactional volumes and network expansion (e.g., agent network, GTV, credit distributed) rather than a traditional order book for future projects.

Source: Inferred

Capital allocation

high confidence
  • Debt Debt disclosed
    We are a zero-debt company and we are seeing close to 31.4% on ROI.

Guidance & targets

Market Share

  • AePS Market Share Market Share · Q2 FY26 · High confidence 18.5%
    Our market share, as of end of Quarter 2 FY'26 in off-us AEPS segment stood close to 18.5%.

    — Aastha Garg

User Growth

  • New UPI Users User Growth · Future · Medium confidence 100 million
    We are committed to bringing the next 100 million UPI users.

    — Dilip Modi

Credit Distribution

  • Monthly Credit Distributed Credit Distribution · Future · Medium confidence ₹100 crores
    our goal is to get to nearly Rs. 100 crores a month kind of a number.

    — Dilip Modi

  • Secured vs Unsecured Mix Credit Distribution · Future · Medium confidence 70% secured, >30% unsecured
    But majority of this, nearly 70% continues to be secured. And maybe the pie on unsecured will be more than 30%.

    — Dilip Modi

Take Rate

  • Take Rate Take Rate · Future · Medium confidence 100 bps
    We are closer to about 40 bps. We want to get to 100 bps.

    — Dilip Modi

Product Launch

  • UPI Cashpoint Launch Product Launch · December '25 · High confidence Launched
    UPI cash withdrawal is the next big lever that is expected to be launched in December '25 that can help us drive growth in this space.

    — Aastha Garg

Regulatory

  • AePS Touch Point Operator Guidelines Go Live Regulatory · January '26 · High confidence Go Live
    One more regulation on the AePS touch point operator guidelines is expected to go live in January which will also sanitize the space more and help us drive growth as more and more standard protocols come in the space.

    — Aastha Garg

What to watch in Q3 FY26

UPI Cashpoint Launch & Adoption

By end of Q3 FY26 (December 2025)
Current Announced at Global Fintech Festival
Target Launched in market, initial adoption metrics

Why it matters

New product leveraging UPI, expected to drive growth in cash withdrawal and expand agent base.

UPI cash withdrawal is the next big lever that is expected to be launched in December '25 that can help us drive growth in this space.

Risks & concerns

  • Decline in MFI industry impacting collections GTV

    medium

    The collections segment saw an 11.9% decline in GTV due to degrowth in the overall MFI industry.

    Management acknowledged

  • Margin pressure in the commoditized collections segment

    medium

    The collections product has become very commoditized, leading to significant margin pressure.

    Management acknowledged

  • Regulatory changes leading to consolidation in AePS

    medium

    New AePS touchpoint operator guidelines are expected to lead to a consolidation phase in the industry.

    Management acknowledged

Q&A highlights

5 direct
Contribution of Credit and Spice Pay business to bottom-line Partial
Al will play a big role here. We are very excited about Al programs under Spice Money... this is an area which I believe will contribute significantly to our bottom-line over the next couple of years.

Analysts are looking for quantification of new business segments' impact, management provides strategic direction and confidence in future contribution.

Asked by Gulshan Singh

Growth opportunity and future of UPI cash withdrawal Partial
UPI Cashpoint, Gulshan, this is a great initiative of the regulator, of DFS, of NPCI, today, we already see in the market that a lot of people are using UPI to withdraw cash from their nearby merchant point... we know that the number of UPI app users in the country versus the number of AePS users, it's an X factor.

Highlights a new product launch and its potential to expand the agent base and transaction volume, leveraging the growing UPI ecosystem.

Asked by Gulshan Singh

ROCE targets and expected increase Direct
our operating efficiency keep on going and with what I had mentioned in my profitability presentation, that more and more products we can put on this channel... our return on capital employed will have a growth and have immense growth potential.

Analysts are seeking specific financial targets, and management points to operational efficiency and new products as drivers for future ROCE growth.

Asked by Gulshan Singh

Biggest road drivers for H2 FY26 and FY27 (AePS, CASA, Credit) Direct
between AePS, CASA and credit, we are most bullish around credit. Then when it comes to AePS... our focus is on consolidation... CASA... it's not about number of accounts. It's about quality of accounts.

Provides clear strategic priorities for growth in the near to medium term, indicating where management expects the most significant impact.

Asked by Raj Vyas

Additional monetization avenues beyond core CASA income as float balances expand Direct
our goal is to work with our banking partners to drive a CRM program where we get engaged to understand what are the products can they be used to become fully banked... start looking at products like credit and insurance.

Details the strategy to leverage growing float balances and customer relationships for deeper financial inclusion and revenue generation through cross-selling.

Asked by Vedika

Adoption target for CASA for next 12 months and ARPU uplift per activated agent Partial
what we are equally, if not more keen on is to drive more business per agent... our focus is about making sure that the quality of accounts and the quality of agents onboarding customers with these accounts is the key metric that we want to chase.

Clarifies the company's focus on quality and productivity per agent rather than just raw numbers for CASA, which is crucial for sustainable growth.

Asked by Suraj Shinde

FY26 full year disbursement target for secured lending and secured vs unsecured mix Direct
our goal is to get to nearly Rs. 100 crores a month kind of a number. But majority of this, nearly 70% continues to be secured. And maybe the pie on unsecured will be more than 30%.

Gives a specific forward-looking target for a key growth area (credit distribution) and its composition.

Asked by Suraj Shinde

Early delinquency and 30+ DPD numbers for secured loan portfolio and loss rates Direct
on the secured loans, we are not underwriting any losses. There is no delinquency that we participate in. Secured loans for our partners is by definition a better category when it comes to managing delinquency. But our role is more as lead originators.

Clarifies the company's asset-light model and limited risk exposure in secured lending, acting primarily as a lead originator.

Asked by Suraj Shinde

3 min read 7 chapters

Detailed narrative

Spice Bharat Stack Vision & Financial Inclusion

DigiSpice is building a 'Spice Bharat Stack' to provide formal financial services to unserved/underserved small-town India. This includes assisted digital payments, basic banking, and credit, leveraging its 1.6 million BC agent network to reach over 100 million customers across 2.5 lakh small towns. The company aims to digitize cash and bring new-to-UPI users onto the digital platform, committing to bringing the next 100 million UPI users on board.

Q2 & H1 FY26 Financial Performance

The company reported Q2 FY26 revenue of ₹124 crores, a 14% YoY increase, with gross margin at ₹52 crores, up 20% YoY. EBIT for Q2 stood at ₹10.6 crores (30x YoY), and PAT was ₹7.2 crores, marking the second consecutive profitable quarter. For H1 FY26, EBIT was ₹20.8 crores and PAT ₹14.3 crores. The company operates an asset-light model, with only 11% of net worth linked to business CAPEX, contributing to an annualized ROCE of 12.8% and ROI of 31.4%.

Agent Network & Product Growth

The agent network expanded to 1.6 million BC points, with 12.3 lakh agents in tier 4, 5, or 6 small towns. Customer Gross Transaction Value (GTV) for Q2 FY26 reached ₹32,270 crores, up 22% YoY. Cash Management Services (CMS) GTV was ₹11,505 crores (up 30% YoY), while BBPS reached ₹1,300 crores per quarter. The company's AePS market share stood at 18.5% in Q2 FY26, driven by improved success rates (from 63.8% in FY24 to 74% now) and subscription pack sales.

Credit Distribution & CASA Accounts

Credit distribution grew significantly, reaching ₹176 crores in Q2 FY26, a 2.6x YoY increase. The focus is on both secured (₹155.7 crores) and unsecured (₹20 crores) loans, with a goal of achieving ₹100 crores per month, primarily secured (70%). In CASA, the company has opened over 1.3 million accounts, with float balances growing 61% YoY to ₹245 crores. The strategy emphasizes quality of accounts and driving more business per agent, aiming to cross-sell products like credit and insurance.

New Product Launch: UPI Cashpoint

DigiSpice launched UPI Cashpoint at the Global Fintech Festival, allowing any smartphone user with a UPI app to withdraw cash from BC points by scanning a QR code. This product, expected to be launched in December 2025, is seen as a high-growth opportunity, leveraging the extensive last-mile network and the growing UPI penetration to enable easier cash withdrawal with limits of ₹5,000 per transaction and ₹10,000 per day.

Strategic Focus & Partnerships

The company operates as a platform-first business, focusing on partnerships and holding key licenses including PPI, BBPS, corporate agency for insurance, and AUA/KUA from UIDAI. It collaborates with banking partners (Axis, YES Bank, NSDL) for banking services and NBFCs for credit. The strategy involves deep API integration for collections and leveraging AI for underwriting and agent assistance, aiming to be a leading ATM and collections network.

Challenges & Future Outlook

While growth is strong, the collections segment experienced an 11.9% decline in GTV due to degrowth in the MFI industry and faces margin pressure. The company is investing in new engines (credit, Spice Pay) and AI-led interventions to drive profitability and efficiency. Upcoming regulatory changes for AePS touchpoint operators in January 2026 are expected to lead to market consolidation, which DigiSpice aims to capitalize on by driving growth as more standard protocols come into play.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Information Technology earnings calls