With the Launch of QIP, Zaggle Prepaid Sets the Floor Price at INR 550.73 per share

Nitin Konde, Varun Bhardwaj

Dec 20, 2024 — 2 min read

Zaggle Prepaid Sets QIP Floor Price at INR 550.73 per Share

The qualified institutional placement (QIP) offer for the fintech SaaS business Zaggle has begun with the goal of raising INR 950 Cr. The business stated in an exchange filing that the opening of the offer was approved by the board's capital raising committee, which also established the floor price for the QIP at INR 550.73 per equity share. Compared to the stock's most recent closing price on 18 December, this indicates a 1.9% discount. The floor price for the aforementioned issuance is INR 550.73 per equity share, since December 18, 2024, is the "relevant date" for the purposes of the issue. According to the filing, "the company may offer a discount of not more than 5% on the floor price calculated for the issue." The company has designated Nuvama Wealth Management, Equirus Capital, and Motilal Oswal Investment Advisors as merchant bankers to oversee the QIP.

Firm’s Plans to Utilise Proceeds

Following an October 30 board of directors meeting, Zaggle announced plans to fund up to INR 950 Cr through a QIP. The company stated at the time that the board had given its approval to the plan to raise money through the issuing of convertible bonds, equity shares, non-convertible securities, and any other kind of instrument. Zaggle intends to allocate INR 500 Cr from the QIP proceeds for acquisitions and investments, as stipulated in the offer document. The remaining sum will be used for general business reasons, with INR 59.1 Cr going towards the prepayment or payback of outstanding loans that the company has taken out. Established by Raj Narayanam in 2011, Zaggle provides corporate employee benefits and spend management solutions. It states that as of September 2024, it served over 3.03 million people and issued 50 million prepaid cards.

Current Financial Report of Zaggle

In the second quarter (Q2) of the fiscal year 2024–25 (FY25), the company reported a consolidated profit after tax of INR 20.29 Cr, up 167.67% from INR 7.58 Cr in the same period last year. From INR 184.24 Cr in Q2 FY24 to INR 302.55 Cr during the reviewed quarter, operating revenue increased 64.21%. The QIP issue coincides with a month-long increase in Zaggle's stock price. The stock has increased by around 27% since November 18. On December 17, it surged to an all-time high of INR 597 on the BSE. On December 18, Zaggle's shares ended the day 2.91% lower on the BSE at INR 561.35.

Speaking earlier to a media outlet, Avinash Godkhindi, the managing director and chief executive officer of Zaggle Prepaid, stated that the financial technology company was on track to surpass its revenue projections by fiscal 2026, supported by a number of recent actions made by the business. The company's revenue in the previous fiscal year was close to INR 776 crore.