Zaggle Prepaid

Zaggle Prepaid reported a robust Q1 FY26, achieving its highest-ever Q1 revenue of INR 331 crores, marking a 31% year-over-year growth. Profitability also saw significant improvement, with adjusted EBITDA increasing by 28% to INR 33 crores and PAT surging 55% to INR 26 crores. The Propel platform was a key growth driver, with its revenue surging 50.6% YoY, while SaaS fees grew 19.8% YoY. An investment in Mobileware generated INR 17 crores in Q1 FY26 revenue, already surpassing its entire FY25 PBT.

The company is actively pursuing an inorganic growth strategy, with 6 companies under investment or acquisition, 2 of which are already completed and 4 progressing. These initiatives are expected to add 600-700 people to the workforce and generate approximately INR 25 crores in savings over the next year through consolidated functions like technology, finance, and HR. Key proposed acquisitions include EffiaSoft for merchant services, Dice for spend management (expected to contribute INR 20-22 crores revenue in FY26), Greenedge for loyalty, and Rio.money for consumer credit cards.

Zaggle is deeply integrating AI across its operations to enhance efficiency and customer value. Initiatives include a flagship conversational AI platform for Zintel, a multilingual conversational AI tool expected to be ready in 3-4 months, and an AI-powered bill processing automation tool that has reduced overall TAT by over 80%. The company is also piloting an AI-driven claim validation and approval workflow, aiming to deliver tangible benefits to customers rather than chasing fashionable trends.

The company continues to expand its market presence through strategic alliances and ecosystem partnerships. A channel partnership with Grant Thornton will broaden access to corporate clients, while a 7-year agreement with Mastercard strengthens its prepaid card offerings. Zaggle has also onboarded Tata Capital as a leasing partner and OneAssist as an insurance partner, further enhancing its Smart Employee Purchase Program and overall ecosystem.

After experiencing negative operational cash flows in previous years up to FY25, Zaggle has turned positive in FY25 and expects to maintain this positive momentum in the current fiscal year (FY26). This turnaround is attributed to the company's growth phase and focus on operational efficiency. In FY25, the company invested approximately INR 40 crores solely in developing in-house technology, underscoring its commitment to product innovation and building proprietary capabilities.

Zaggle is strategically targeting international expansion, with the Middle East and North Africa (MENA) region and the U.S. identified as key priority markets. While it's still early to quantify specific revenue contributions from these regions, the company is making small-ticket investments through VC funds in early-stage SaaS companies in the U.S. to gain market insights and identify potential acquisition opportunities, aligning with its calibrated global footprint strategy.