Zaggle Prepaid Ocean Services IPO was fully subscribed at the end of the final day of bidding with investors buying 24.28 crore equity shares, 12.86 times higher than the offer size of 1.88 crore shares.
The total portion set aside for qualified institutional buyers was 75% of which they bid 16.94 times. For high networth individuals, 15% was reserved which was subscribed 9.16 times while out of the 10% reserved for retail investors, it was subscribed 6.15 times.
Incorporated in 2011, Zaggle operates in the business-to-business-to-customer (B2B2C) segment. It is among one of the few uniquely positioned companies that offers diversified fintech products and services, including prepaid cards in India in partnership with banks, along with certain SaaS (software as a service) offerings, including tax and payroll software.
According to its Red Herring Prospectus (RHP), Zaggle says, “We are a leading player in spend management, with more than 50 million prepaid cards issued in partnership with banking partners and more than 2.27 million users served, as of March 31, 2023. We offer a differentiated value proposition and diversified user base.”
What is Zaggle’s Business?
“We are placed at the intersection of the SaaS and fintech ecosystems, and our SaaS platform is designed for: (i) business spend management (including vendor management and expense management); (ii) rewards and incentives management for employees and channel partners; and (iii) gift card management for merchants, which we refer to as CEMS (customer engagement management system). We cater to corporates and SMBs and start-ups across India, ” Zaggle in its RHP said.
The fintech company has several products that cater to a wide range of requirements. Some of its key products are:
- Propel: corporate SaaS platform for channel rewards and incentives, employee rewards and recognition
- Save: SaaS-based platform and a mobile application to offer expense management solution for business spend management facilitating digitised employee reimbursements and tax benefits
- CEMS: customer engagement management system that enables merchants to comprehensively manage their customer experiences including rewarding merchants through gift card and loyalty benefits
- Zaggle Payroll Card: a prepaid payroll card that allows our Customers to pay contractors, consultants, seasonal and temporary employees, and unbanked wage workers as an alternative to direct deposits to bank accounts or cash payments
- Zoyer: an integrated data driven, SaaS based business spend management platform with embedded automated finance capabilities in core invoice to pay workflows
In a nutshell, this is how Zaggle makes money through its diversified business model:
According to a report, during FY21-23, Zaggle’s revenue from operations grew at a CAGR of 52% and the adjusted profit after tax increased at a CAGR of 38% due to an increase of 151% in its user base. It has recorded a consolidated net profit of ₹36.9 crore on revenue of ₹553.5 crore for FY23.
With this IPO, the company aims to spend that money to retain their existing customers while expanding the customer base. It also aims to build technology and create innovative products.
