Zaggle Share Price Drops 6% Following Q1FY24 Earnings Report

Zaggle Share Price Drops 6% Following Q1FY24 Earnings Report

VoM News Desk | October 12, 2023 | 01:35 PM IST | Breaking News | Follow on Google News

Zaggle Share Price Drops 6% Following Q1FY24 Earnings Report

Zaggle Share Price Drops 6% Following Q1FY24 Earnings Report

Zaggle, a SaaS fintech company, witnessed a nearly 6% drop in its share price in Thursday’s trading session after reporting disappointing earnings for Q1FY24. The company revealed its earnings for the quarter ending in June, which had a significant impact on its stock performance.

According to the company’s exchange filing, Zaggle’s profit after tax (PAT) for the quarter ending in June plunged by 67.4% year-on-year, decreasing from ₹6.3 crore in Q1FY23 to ₹2.06 crore. However, the company reported that its revenue from operations for the same quarter showed a 33.7% year-on-year increase, reaching ₹118.5 crore.

Key Growth Drivers

Zaggle attributed its revenue growth to the expansion of its client base, the introduction of a new product called “Zoyer,” and the growth of its corporate credit card business. The company expressed optimism about its recent endeavors, emphasizing the positive impact of its corporate credit cards and the launch of the vendor management platform, Zoyer.

Zaggle reported a decline of 26.5% in earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter ending in June. This decrease was due to a shift in the product mix, which had a negative effect on gross margin. However, the company highlighted that the proportion of total sales allocated to incentive and payback expenses has been decreasing steadily, mitigating the impact of the gross margin decline.

Outlook and Reduced Financing Expenses

Zaggle remains optimistic about the future, expecting a continuation of the trend where margin profiles improve in the second half of the year compared to the first half. The company has also reduced its borrowings since its IPO and anticipates lower financing expenses starting in Q3FY24, thanks to its improved balance sheet position.

The company highlighted significant developments, including a contract with BOB Financial Solutions Limited for implementing a commercial card onboarding and value-added services platform. Zaggle also launched the Zaggle Yes Bank Corporate Credit Card, powered by Zaggle Zatix, which is a spend analytics platform designed to streamline business and employee expenses, improve budgeting, and facilitate favorable supplier negotiations.

About Zaggle

Zaggle Prepaid Ocean Services is a financial technology company that offers products and services for managing corporate business expenses through automated and innovative workflows.

VoM News Desk

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