ZAGGLENSE11 October 2023

Zaggle Prepaid Ocean Services Limited has informed the Exchange about Investor Presentation

Zaggle Prepaid Ocean Services Limited

ZAGGLE/23-24/10

October 11, 2023

To Listing Department, NATIONAL STOCK EXCHANGE OF INDIA LIMITED Exchange Plaza, Plot No C/1, G Block Bandra Kurla Complex, Bandra (East), Mumbai -400 051, Maharashtra

To The Corporate Relations Department BSE LIMITED Phiroz Jeejeebhoy Towers, 25th Floor, Dalal Street, Mumbai -400 001, Maharashtra

Company Symbol: ZAGGLE

Company Scrip Code: 543985

Dear Sir / Madam,

Sub: Investor Presentation for the quarter ended June 30, 2023

Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we enclose herewith Investor Presentation for the quarter ended on June 30, 2023

The same is also being uploaded on the website of the Company viz., www.zaggle.in

We request you to kindly take the same on record.

Thanking you,

For Zaggle Prepaid Ocean Services Limited

Hari Priya Company Secretary and Compliance Officer

Zaggle Prepaid Ocean Services Limited Investor Presentation October 2023 – Q1FY24

Safe Harbor

This presentation and the accompanying slides (the “Presentation”), which have been prepared by Zaggle Prepaid Ocean Services Limited

(the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to

purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment

whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed

information about the Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the

Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy,

completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain

all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is

expressly excluded.

This presentation contains certain forward looking statements concerning the Company’s future business prospects and business profitability,

which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking

statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations

in earnings, our ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to

attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations,

government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The Company does not

undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any

forward looking statements made from time to time by or on behalf of the Company.

From the Founder’s desk…

“We are delighted to see a stupendous response to our IPO. We express our gratitude to all the shareholders for reposing their faith in us. We extend our congratulations to every stakeholder of the company, i.e., employees, customers, business partners and bankers who were part of our IPO journey.

During Q1FY24, we delivered an operational revenue of ₹ 1,185 mn with a strong 34% YoY growth. This increase is attributed to our recent endeavors, notably the introduction of corporate credit cards and launch of our vendor management platform – Zoyer. Further, this growth was fueled by customer base expansion and cross-selling initiatives.

Our Adjusted EBITDA (before ESOP expenses) grew by 27% to ₹ 138 Mn with 11.7% margin. Over the years, the proportion of our Q1 revenues in relation to the total annual revenues is close to 16% and Q2 is around 24%. Accordingly, with operating leverage coming into play historically our margin profiles see an improvement in H2 v/s H1. Going forward, we expect similar trend to continue.

Post IPO, with a stronger balance sheet position, we have reduced our borrowings and expect significantly lower finance costs from Q3FY24 onwards.

Raj P Narayanam Founder and Executive Chairman

Some of our recently noteworthy developments include our contract with BOB Financial Solutions Limited for Implementing Commercial card Onboarding & value-added services platform and launch of the Zaggle Yes Bank Corporate Credit Card, powered by Zaggle Zatix – a spend analytics platform that allows corporates to streamline business and employee expenses, budget better and negotiate favorable supplier terms.

India is at the forefront of the fintech and digital revolution, and there are very strong tailwinds that are propelling growth of the digital payments industry. This combined with our unique positioning in the spend management space gives us a significant competitive advantage.

Our expectation of revenue growth for this fiscal year is in the range of 40% to 50%, with an Adjusted EBITDA Margin (before ESOP expense) between 11% and 13%. Further, we expect the total ESOP expense to be close to ₹ 200 mn in the fiscal year.”

Performance Highlights

Financial highlights

Revenue from operations (₹ Mn)

33.7%

1,185

886

Gross Profit (₹ Mn)

9.7%

606

553

Q1FY23

Q1FY24

Q1FY23

Q1FY24

Adjusted EBITDA (₹ Mn)

Reported EBITDA (₹ Mn)

Cash PAT (₹ Mn)

27.4%

138

108

-26.5%

108

after ESOP expense of ₹58.44 Mn in Q1FY24

38.7%

PAT + Depreciation & Amortization + ESOP Expense

Q1FY23

Q1FY24

Q1FY23

Q1FY24

Q1FY23

Q1FY24

Profit and loss statement

(₹ Million, unless stated otherwise)

Q1FY24

Q1FY23

Revenue from operations

Gross Profit

Gross Profit Margin

Employee benefits expense

Incentive and cash back

Other Expenses

Adjusted EBITDA

Adjusted EBITDA Margin

ESOP Cost

Reported EBITDA

Reported EBITDA Margin

Other Income

Depreciation & amortisation (DA)

EBIT

EBIT Margin

Finance Cost

Profit before Tax

Tax

Profit After Tax

PAT Margin

Cash PAT (PAT+DA+ESOP)

EPS - Basic (₹)

EPS – Diluted (₹)

1,184.79

606.19

51.16%

81.02

249.85

137.32

138.00

11.65%

58.44

79.56

6.72%

14.56

20.05

74.07

6.25%

44.13

29.94

9.39

20.55

1.73%

99.04

0.24

886.23

522.72

58.98%

61.90

254.81

97.73

108.28

12.22%

108.28

12.22%

0.38

8.43

100.23

11.31%

14.40

85.83

22.83

63.00

7.11%

71.43

0.68

YoY

33.7%

16.0%

27.4%

-26.5%

-26.1%

-67.4%

38.7%

FY23

5,534.60

2,328.37

42.07%

291.70

1,002.01

409.57

625.09

11.29%

144.13

480.96

8.69%

11.15

61.99

430.12

7.77%

113.77

316.35

87.34

229.01

4.14%

435.13

2.48

2.46

 34% YoY growth in the topline driven by:

o Growth in corporate credit cards business

o Launch of new product, i.e., Zoyer

o Customer base expansion

 Drop in gross margin was primarily led by

change in product mix. On the other hand, Incentive and cash back expense as a percentage of total revenue has been reducing over the quarters and witnessed 7% decline vis- à-vis Q1FY23. This neutralized the impact of drop in gross margin

The company has added employees to support future growth of the business

Total ESOP expense in FY24 is expected to be close to ₹ 200 mn

Surge in finance costs was due to high-cost debt. Post the IPO, the company has repaid ₹ 470 mn of borrowings which will result in lower finance cost from H2



Key operational performance indicators

Total customers catered to (number)

Aggregate users on the platform (million)

Key Performance Indicators KPIs

2,411

36.7%

2,596

1,899

2.27

22.2%

2.42

1.98

Q1FY23

Q1FY24

FY24

Q1FY23

Q1FY24

FY24

Platform fee / SaaS fee / service fee (1)

Program fees (2)

Propel platform revenue / gift cards (3)

Revenue Mix (₹ Mn)

7.5%

242

17.8%

480

408

1,695

54.0%

634

3,598

412

Q1FY23

Q1FY24

FY24

Q1FY23

Q1FY24

FY24

Q1FY23

Q1FY24

FY24

Note: (1) All fee income received including the fixed monthly subscription fees paid by Customers on a per User basis and any one-time setup fees and any other fees levied, (2) The sum of (i) interchange fees earned on the spend that Users make on the cards; (ii) any other income which we receive from the Preferred Banking Partners and Payment Networks; and (iii) inactivity fees which are earned on the balance amount left on the cards, (3) Revenue received from Customers for issuing reward points (Propel points) to Customers’ employees and channel partners,

Quarterly revenue mix

Q3 & Q4 are higher revenue quarters in the business

Contribution to annual revenues

16.0%

23.5%

26.7%

33.8%

1,873

1,475

1,300

Revenue from operations (₹ Mn)

886

 Higher transaction volumes associated with the festive season in the third quarter of each Fiscal and annual sales events such as the festive season sales

1,185



Furthermore, company also experiences an increase in transaction volumes in the fourth quarter of each Fiscal, with users transacting to exhaust any pending balance on their cards before the end of a financial year

Q1FY23

Q2FY23

Q3FY23

Q4FY23

Q1FY24

33.7% YoY growth

What we do

Zaggle: Placed at the intersection of SaaS and Fintech

SaaS

Zaggle’s Space: Intersection Point

Headquartered (1) at Hyderabad, Telangana

Fintech

273 employees (2)

Profitable 11.29% FY23 Adjusted EBITDA Margin (3)

50 Mn+ co-branded prepaid cards (4)

Strong financial track record (₹ Mn)

FY21

FY22

FY23

2,399.66 3,712.55 5,534.60

Revenue from Operations

FY21 276.27

FY22

FY23

598.54

625.09

Adjusted EBITDA

Key operating metrics as of and for the year ended March 31, 2023

1,832

Corporate Accounts (5)

579

SMB Accounts (6)

2,411

Total Accounts

2.27 Mn Active Users (7)

FY21

213.76

FY22

440.18

FY23 435.13

Cash PAT

1.54%

Churn (8)

Source: Frost & Sullivan Report. Note: (1) Registered Office (2) As of March 31, 2023 (3) Adjusted EBITDA before ESOP expenses (4) Since the inception of business (5) Organizations with more than 250 Users (6) Organizations with 250 or fewer Users (7) Employees, channel partners, and customers of Customers (8) Corporates and SMB customers discontinuing their subscription and other services on the platform

Key strengths

Differentiated SaaS-based fintech platform

In-house developed technology with strong network effect

Business model with diversified revenue streams across products

Diversified customer relationships across sectors along with preferred banking and merchant partnerships

Seasoned management team and board

Differentiated SaaS-based fintech platform

Offering a combination of payment instruments, mobile application and API integrations

Omnichannel technology offering

VISA powered cards

Mobile app to manage spends

Partners

Dashboard to manage reporting & analytics

Tata Securities

The Brand Names and Logos mentioned are the property of their respective owners and are used here for identification purposes only

… Strong network effect

Banking Partners

Network Partners

VAS Partners

Key Partners

Tata Securities

Partners

Sell software Monetize GTV

Businesses

User base

e g g a Z

l l

e s e R

d n e p S

P m

t .

n s t r u m e n t

B a n k n g

l i

c e n s e s &

Users / deals

Software / users

Merchants

Comprehensive Monetization

m o n e t i z a

t i o n

i r

e c t

The Brand Names and Logos mentioned are the property of their respective owners and are used here for identification purposes only

Employees /Users

Zaggle: Key product and service offerings

Propel

• Channel rewards and

incentives

• Employee rewards and

recognition

Save

• Expense Management

• Employee Reimbursements

• Employee tax benefits

Zoyer

•

Integrated data-driven business spend management platform with embedded finance capabilities

Diversified revenue streams across products

SOFTWARE FEES

CARD TRANSACTION INCOME

SOFTWARE FEES

CARD TRANSACTION INCOME

PROPEL POINTS

SOFTWARE FEES

CARD TRANSACTION INCOME

Seasoned management team and board

p h s r e d a e L

Raj P Narayanam Founder and Executive Chairman

Avinash Ramesh Godkhindi Managing Director and CEO

 



Founded Zaggle in 2011 with a vision to simplify corporate spends Completed post-graduate diploma in business management with specialization in finance from the FORE School of Management - New Delhi He has experience in the technology and fintech industry Has made varying levels of investments in certain companies at different points in time Has served on the board of the company since 2012

 

   

Leading Zaggle’s growth since 2012 Holds a bachelor’s degree in engineering from Bangalore University, Bengaluru, and a master’s degree in business administration from the University of Chicago, Chicago Has served on the board of the company since 2012 Awarded the “Inspiring CEO” award by the Economic Times in 2022 He has experience in the banking industry Prior to joining Zaggle, Avinash worked with Citibank in India

s r o c e r i

o d a o B

Arun Vijaykumar Gupta Non-Executive Director

Aravamudan Krishna Kumar Independent Director

Abhay Deshpande Raosaheb Independent Director

Prerna Tandon Independent Director



Holds a bachelor’s degree in commerce from the P.D. Lion’s College of Commerce and Economics, University of Bombay

Directorships: Route Mobile, Protinus Fashion Networking



Holds a bachelor’s degree in arts and economics

(honors course) from the University of Delhi

Certified associate of the Indian Institute of Bankers

He retired in 2014 from State Bank of India as MD

Directorships: SBI Payment Services, MTAR Technologies, TVS Wealth, Delphi TVS Technologies, Sathguru Catalyser, Ecofrost Technologies, Suraksha ARC, Ecozen Solutions



Holds a bachelor’s degree in computer science and engineering from the Dr. Babasaheb Ambedkar Marathwada University, Aurangabad, Maharashtra

He has experience in the IT industry

Directorships: Rapidue Technologies, Payswiff Technologies, Recykal Foundation, Anubhuti Welfare Foundation



Holds a master’s degree in business administration from the Panjab University, Chandigarh

She worked as the Vice President – operations at Infosys BPO Limited & Vice President – productivity & digitization leader at Genpact India



Directorship: Nirmal Bot Limited

t n e m e g a n a M

Venkata Aditya Kumar Grandhi Chief Financial Officer

Hari Priya Company Secretary & Compliance Officer

 Member of The Institute of Chartered Accountants of India, New Delhi

He has experience in the financial services industry

Prior to joining Zaggle, he worked at Spandana Sphoorty Financial Limited as Vice President Investor Relations-Finance



 Member of the Institute of Company Secretaries of India, New Delhi and bachelor’s

degree in law from Osmania University,University



Prior to joining Zaggle, she worked at Spandana Sphoorty, Gayatri Projects and Axis Clinicals

Zaggle in a nutshell

Seasoned management team and board

Seasoned team

Multi-product strategy

SaaS-based platform with a comprehensive product stack

Revenues from operations have grown at 49.08% in the year ended March 31, 2023, with an EBITDA margin of 8.69%

Customer churn rate at 1.54% in the year ended March 31, 2023

Robust financial metrics

Consistent customer Retention

Technology and network

In-house technology with strong network effect

Large addressable market

Overall estimated market revenue (2027) for Payments in India : ₹ 1750+ Bn

Customer acquisition and retention costs of 18.07% of total revenue

Low CAC and retention costs

Ecosystem- based approach

Business model with diverse sources of revenue across SaaS and fintech

Note: FY: Financial Year

Annexure

Historical Financial and operating metrics

Corporate customers

Aggregate users (1) (Mn)

Revenue from operations (₹ Mn)

2,411

1,753

1.72

1,092

0.90

3,712.55

2,399.66

2.27

5,534.60

FY2021

FY2022

FY2023

FY2021

FY2022

FY2023

FY2021

FY2022

FY2023

Adjusted EBITDA & EBITDA margin(₹ Mn)

Reported EBITDA & EBITDA margin (₹ Mn)

Cash PAT & Cash PAT margin (₹ Mn)

CAGR: 50.42%

598.54

625.09

CAGR: 31.94%

598.54

after ESOP expense of ₹144.13 in FY23

276.27

11.51%

16.12%

11.29%

276.27

11.51%

16.12%

480.96

8.69%

CAGR: 42.67%

440.18

435.13

213.76

8.91%

11.86%

7.86%

FY2021

FY2022

FY2023

FY2021

FY2022

FY2023

FY2021

FY2022

FY2023

Note: (1) Total number of users (Employees, channel partners, and customers of Customers) served by the company, FY: As of and for the year ended March 31

Historical Balance sheet

Particulars

FY23

FY22

FY21

Particulars

FY23

FY22

FY21

ASSETS

Non-current assets

Property, plant and equipment

Right-of-use assets

Intangible assets

Intangible asset under development

Financial assets

(i) Investments

(ii) Other financial assets

Other non-current assets

Income-tax assets (net)

Deferred tax assets (net)

Total non-current assets

Current assets

Inventories

Financial assets

(i) Investments

(ii) Trade receivables

(iii) Cash and cash equivalents

(iv) Bank balances other than (iii) above

(iv) Other financial assets

(v) Other financial assets

Other current assets

Total current assets

Total assets

23.48

196.73

68.90

108.68

4.85

14.69

29.77

119.01

23.1

589.21

19.77

55.15

44.29

15.00

7.3

21.38

123.59

24.59

311.07

9.51

36.75

26.97

4.13

74.70

106.88

258.94

0.97

1.12

2.69

12.32

1026.59

195.89

30.07

1.15

491.39

1,758.38

2,347.59

429.51

7.11

29.00

148.72

615.46

926.53

226.81

27.89

5.00

99.47

361.86

620.8

EQUITY AND LIABILITIES Equity Equity share capital Other equity Total equity Liabilities Non-current liabilities Financial liabilities (i) Borrowings (ia) Lease liabilities Provisions Total non-current liabilities Current liabilities Financial liabilities (i) Borrowings (ia) Lease liabilities (ii) Trade payables

- Total outstanding dues of micro and small enterprises

- Total outstanding dues of creditors other than micro and small enterprises

Provisions Other current liabilities Current tax liabilities (net) Total current liabilities Total liabilities

Total equity and liabilities

92.22 395.29 487.51

513.29 158.65 11.43 683.37

697.44 44.10

9.63

82.56

0.22 294.96 47.80 1,176.71 1,860.08

2,347.59

1.80 -37.38 -35.58

483.27 51.04 7.22 541.53

161.45 7.35

1.80 -457.31 -455.51

376.92 31.89 5.66 414.47

313.92 7.85

7.77

0.08

99.58

0.14 144.29 0 420.58 962.11

926.53

190.96

0.11 148.92 0 661.84 1,076.31

620.8

The Parent Company has incorporated a wholly owned subsidiary named as Zaggle Technologies Limited (“ZTL”), a private Company in the UK on January 12, 2023, as a subscriber to the memorandum. ZTL had allotted 1 equity share of GBP 1 to the Company upon incorporation, such shares remained unpaid as of March 31, 2023. ZTL had not commenced any business, operations or activities since its incorporation and there were no transactions during the period January 12, 2023, to March 31, 2023. The Parent Company’s Board of Directors on its meeting held on August 26, 2023 has decided to request ZTL to apply to the registrar of companies through its director, to strike off its name off the register in compliance with applicable provisions of the UK laws. Accordingly, the strike-off application was duly made by ZTL on August 26, 2023. Considering above the Company has prepared its first consolidated financial statement for the year ended March 31, 2023.

Historical Profit and loss statement

Particulars (₹ Million, unless stated otherwise)

Revenue from operations

Gross Profit

Gross Profit Margin

Employee benefits expense

Incentive and cash back

Other Expenses

Adjusted EBITDA

Adjusted EBITDA Margin

ESOP Cost

Reported EBITDA

Reported EBITDA Margin

Other Income

Depreciation

EBIT

EBIT Margin

Finance Cost

Profit before Tax

Tax

Profit After Tax

PAT Margin

Cash PAT (PAT+DA+ESOP)

EPS - Basic (₹)

EPS – Diluted (₹)

FY23

5,534.60

2,328.37

42.07%

291.70

1,002.01

409.57

625.09

11.29%

144.13

480.96

8.69%

11.15

61.99

430.12

7.77%

113.77

316.35

87.34

229.01

4.14%

435.13

2.48

2.46

FY22

3,712.55

2,259.69

60.87%

154.30

1,176.43

330.42

598.54

16.12%

598.54

16.12%

4.09

20.97

581.66

15.67%

69.88

511.78

92.57

419.21

11.29%

440.18

4.57

FY21

2,399.66

2,087.87

87.01%

124.60

1,380.31

306.69

276.27

11.51%

276.27

11.51%

3.27

20.46

259.08

10.80%

77.10

181.98

(11.32)

193.30

8.06%

213.76

2.11

Key awards, accreditations and recognitions

Global Banking & Finance Award: Excellence in Innovation Business Spend Management Software India 2023

10th Payments Industry Awards: Best B2B Payment Solution Provider, 2023

BW Businessworld Festival of Fintech Conclave Awards: Winner – Best Payments Solutions of the Year, 2023

Govt of Telangana: Recognized for building a robust and sustainable SaaS and fintech business, 2022

India Startup Festival: “Certificate of Appreciation” by Sri Sathya Sai Grama Muddenahalli, 2022

BW Businessworld Festival of Fintech Conclave Awards: Best Digital Card, 2021

World HRD Congress and Awards: “Best Employee Engagement Award in B2B Sector”, 2021

Human Excellence Award: Awarded the “Best Employee Engagement Program (Multi Industry)”, 2021

India Digital Awards: Best Prepaid Card Solution, 2019

Certiva: Certificate of compliance with ‘ISO/IEC 27001:2013’

Marksmen Daily: Most Preferred Workplace, 2022

Thank you

Company

Zaggle Prepaid Ocean Services Limited

CIN: U65999TG2011PLC074795 Hari Priya, Company Secretary & Compliance Officer Email id: Investor.Relations@zaggle.in

Investor Relations Advisor

Strategic Growth Advisors Pvt Ltd.

CIN: U74140MH2010PTC204285 Devika Shah / Shikha Puri Email id: devika.shah@sgapl.net / shikha.puri@sgapl.net Tel No: +91 9920764659 / +91 9819282743

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