Fintech Zaggle's debut fizzles out with flat listing gains

Fintech Zaggle's debut fizzles out with flat listing gains
Source: Pixabay
  • The stock listed at ₹168 as compared to its IPO price of ₹164.
  • The marketcap of the company is at ₹2,028 crore according to Bombay Stock Exchange.
  • It plans to use net proceeds to acquire and retain customers, tech development, loan payment and more.
Zaggle Prepaid Ocean Services debuted on the bourses at a 2.9% premium on Friday morning. But the stock fell in trade today, leaving with losses on listing to the tune of 3.4%.

The stock closed at ₹158 as compared to its IPO price of ₹164. The grey market was expecting listing gains to the tune of 9%.

The marketcap of the company is at ₹2,028 crore, according to Bombay Stock Exchange.

The stock markets opened in the red today after crashing for the last two sessions. Sensex was down by 178 points and Nifty by 64 points as of 10:00 am.

Its initial public offer (IPO) was subscribed 12.5 times the shares on offer. The qualified institutional buyer (QIB) portion was subscribed 16.73 times, and the non-institutional investor portion was subscribed 8.8 times. The retail portion was subscribed 5.9 times.


Here are the listing gains of the market debuts in the last few months.

CompanyListing gains
EMS Ltd32.58%
R R Kabel15.6%
Jupiter Life Line Hospitals46%
Rishabh Instruments 0.18%
Ratnaveer Precision Engineering 37%
Vishnu Prakash R Punglia47%
Aeroflex 83%
Pyramid Technoplast12%
TVS Supply Chain5%
Concord Biotech21%

The IPO had a price band of ₹156-₹164 per equity share. The IPO comprises a fresh issue of equity shares aggregating to ₹392 crore and an offer for sale up to 10,449,816 shares by selling shareholders.

It has raised ₹253.52 crore ahead of the public offer from anchor investors like Kotak Equity Opportunities Fund, ICICI Prudential Technology Fund, Eastspring Investments India Fund and more.

The company proposes to utilise its net proceeds towards customer acquisition and retention, technology development and towards re-payment or pre-payment of certain borrowings, and general corporate purposes.

Convergence of SaaS and fintech

Zaggle, which was incorporated in 2011, is a SaaS and fintech company that operates in the B2B2C segment. It interacts and interfaces with customers which are businesses and end users who are employees.

It claims to be a leading player in spend management, with more than 50 million prepaid cards issued in partnership with banks and more than 2.27 million users served, as of March 31, 2023. It has diverse offerings like fintech products and services, and a portfolio of SaaS, including tax and payroll software, it said in its RHP.

Its profits in FY23 fell by 45% in FY23, as compared to the year before. It also experienced negative operating cash flows of ₹15.6 crore in FY23 primarily due to an increase in trade receivables of ₹58 crore.

Its revenues, however, have been steadily growing due to increases in user base, accompanied by an increase in spending by the users. An increase in program fees received due to an overall increase in business scale also aided the growth.

“Several factors contribute to its appeal, including a diverse client base spanning various industries, consistent revenue growth over the years, the company's expansion strategies, a diversified revenue model, and the flourishing digital payments sector,” said a report by Geojit which gave a subscribe recommendation on a short- to medium-term basis.