Zaggle placement draws major banks, raises Rs 595 Cr at 5% discount

Enterprise fintech company Zaggle Prepaid Ocean Services has raised Rs 595 crore through a qualified institutional placement, with the state-owned Bank of India emerging as the largest buyer.

The Mumbai-listed company sold 11.37 million shares at 523.20 rupees each, representing a 5% discount on the floor price. The placement saw strong interest from institutional heavyweights, with Bank of India's ELSS Tax Saver Fund snapping up 16.8% of the offering.

French banking giant Societe Generale secured a 9.2% stake through its ODI (Offshore Derivative Instruments) route. In comparison, domestic players ICICI Prudential Technology Fund and Nuvama Enhanced Dynamic Growth Equity Fund each acquired 6.7% of the issued shares.

The company had recently invested about Rs 48 crore to acquire stakes in two companies, aiming to strengthen its service portfolio. According to a statement, the company infused Rs 32.07 crore to gain a 98.32% controlling stake in Span Across IT Solutions (TaxSpanner), making it a subsidiary and Rs 15.60 crore for a 26% stake in Mobileware Technologies, a digital payment infrastructure provider.

Zaggle reported its best-ever quarterly performance in Q2 of FY25, showcasing the highest year-over-year growth in both revenue and net profit.

The company’s revenue from operations surged to Rs 302.55 crore, up 64.21% from Rs 184.24 crore in Q2 FY24. This rise was accompanied by a notable cost increase, with total expenses hitting Rs 280.5 crore, a 60.3% jump compared to Rs 174.98 crore a year ago.

Despite the higher costs, Zaggle's net profit after tax climbed to Rs 20.29 crore, a rise of 167.67% from Rs 7.58 crore in the same quarter last year.

Zaggle is also eyeing strategic expansions, with plans to pursue M&A opportunities within the SaaS fintech space, targeting segments such as NBFCs and Payments. The company has obtained board approval for a potential fundraise of up to Rs 950 crore to fuel this growth.