Zaggle Prepaid Ocean Services Ltd (BOM:543985) Q3 2026 Earnings Call Highlights: Robust Revenue …

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Sat, February 14, 2026 at 10:02 AM GMT+9 3 min read

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This article first appeared on GuruFocus.

Release Date: February 12, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Zaggle Prepaid Ocean Services Ltd (BOM:543985) reported a strong quarterly revenue growth of 48% year-over-year, reaching INR 498 crores.

The company's adjusted EBITDA crossed INR 50 crores for the first time, marking a 63% year-over-year increase.

Profit after tax surged by 78% year-over-year, reaching INR 36 crores, showcasing significant profitability improvements.

The company has successfully integrated AI into its operations, reducing product development cycles from 75+ days to less than 30 days.

Zaggle Prepaid Ocean Services Ltd (BOM:543985) has expanded its international presence with a new subsidiary in Gift City and plans to establish operations in the UAE.

Negative Points

The company narrowly missed its revenue target of INR 500 crores for the quarter.

There was a notable increase in employee costs due to one-off payments, impacting overall expenses.

The company's cash flow from operations remains a concern, with expectations to turn positive only in FY27.

Incentive costs as a proportion of program fees remain high at around 67%, which the company aims to reduce to 50% over the next five years.

Despite strong revenue growth, the company's return on equity (ROE) remains relatively low, indicating room for improvement in capital efficiency.

Q & A Highlights

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Q: Can you explain the significant jump in platform fees from 12 crores to 79 crores? A: (CFO) The increase is due to a small change in regrouping in the updated financials, which have been regraded to stock exchanges.

Q: How does the Smart Employee Purchase Program (EPP) work, and what are its economics? A: (CEO) The program is highly profitable due to substantial margins from savings on income tax and GST, along with thick commissions. We do not deploy working capital as leasing is done by partners like Tata Capital and Geo Finance.

Q: What led to the increase in employee costs this quarter? A: (CFO) The increase is due to one-off payments related to the regrouping of the structure, amounting to around 2.1 crores, and is not linked to the new labor code impact.

Q: What is the outlook for free cash flow generation and margins? A: (CFO) We expect to be cash flow positive by FY27. Margin expansion is significant, and we aim for an adjusted EBITDA margin of 14-15% in 5 to 7 years, along with a billion-dollar revenue target.

Story continues  

Q: Can you provide an update on the acquisition of Rio.money and its integration? A: (CEO) The acquisition is complete, and the company is rebranded as Zag.money. We aim to leverage our large employee base for cross-selling retail financial products, aided by favorable draft IT guidelines.

Q: How is AI being utilized in your operations, and what impact does it have? A: (CEO) AI is significantly reducing development cycles, from 75+ days to less than 30 days, enhancing agility and efficiency. It is particularly beneficial in automating complex tasks like vendor reconciliation and spend approvals.

Q: What are your plans for international expansion? A: (CEO) We are incorporating a wholly-owned subsidiary in Gift City, and setting up operations in Abu Dhabi to expand in the MENA region, leveraging engagements with key business leaders and stakeholders in the UAE.

Q: How do you view the competitive landscape and your strategic positioning? A: (CEO) Competition exists, but our tech-first, AI-driven approach provides scale and efficiency. We focus on solving deep, complex problems, leveraging institutional knowledge to preemptively address customer issues.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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