Zaggle Prepaid Ocean Services Ltd (NSE: ZAGGLE) Q3 2026 Earnings Call dated Feb. 12, 2026
Corporate Participants:
Raj P Narayanam — Chairman & Executive Director
Avinash Ramesh Godkhindi — Managing Director & Chief Executive Officer
Aditya Kumar — Chief Financial Officer
Analysts:
Unidentified Participant
Devesh Kasliwal — Analyst
Deepak Poddar — Analyst
Sachin Dixit — Analyst
Piyush — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Q326 earnings conference call of Zagal Prepeat Ocean Services Limited. This conference call may contain forward looking statements about the company which are based on the beliefs, opinions and expectations of the company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all powers per lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing Star then zero on attached to a phone.
Please note that this conference is being recorded. I will now hand the conference over to Dr. Rajp Narayan, Executive Chairman, Zagal Prepaid Ocean Service Limited. Thank you. And over to you sir.
Raj P Narayanam — Chairman & Executive Director
Thank you. Thank you so much. You know, a very good evening to everyone. Thank you for joining the earnings call for Zagrel Prepaid Ocean Services Ltd. For the Q3 and nine months of fiscal year 2026. On behalf of the company, I extend a very warm welcome to all of you. On this call we are joined by Mr. Avinash Gaurkinde, Managing Director and CEO Mr. Ajita Kumar, our CFO Mr. Rajesh Tumula Ganti, our Deputy CFO and SGA, our Investor Relation advisor. The financial results, press release and investor presentation are uploaded on the stock exchange and on the company website.
I hope everybody had a chance to to look at it. This quarter marks our best ever quarterly and 9 months performance with a very strong performance across all key matrices. Talking about the quarterly performance comparing Q3FY26 to Q3FY25. The company reported revenue of INR498 crore missing the 500 crore mark by 2 crores, growing at around 48% on a YoY basis. Our quarterly adjusted EBITDA crossed the mark of Rupees 50 crores. For the first time in our history we achieved Rupees 51 crores of Adjusted EBITDA growing at around 63% on a YOY basis. The PAC profit after tax surged to INR 36 crores growing significantly at around 78% on a YOY basis.
Our 9 month FY26 performance. I’m delighted to report that we have surpassed last full year’s profitability levels. Driven by margin expansion at both EBITDA and PAT levels. The company reported revenues at around 1260 crore, growing at around 41% on a Y o y basis. Our adjusted EBITDA stood at around 128 crores, a 48% buy on buy increase. Our pad surged to 95 crores, growing significantly at about 71%. The achievement highlights are relentless bottom line discipline and flawless execution that are powering robust growth across the board through cost efficiencies, revenue optimization and operational agility. I also want to take this opportunity to talk about our AI journey so far.
As a SaaS fintech company over the past year we have shared our vision for how AI would reshape the spend management ecosystem. Today that vision is becoming an operational reality. You would know that as to how IT stocks are being beaten down Moving from aspiration to integration, we have transitioned from discussing AI’s potential to validating its power in real world scenarios. We are currently in the process of launching our AgentIQ AI workflows. Unlike basic automation, these agents are designed to independently execute complex tasks such as automating vendor reconciliation, flagging tax compliance anomalies and streamlining end to end spend approvals.
The impact on our agility and efficiency is already very very clear to us. For example, to develop and deploy a new product feature traditionally took us about 75 plus days. Now the same can be rolled out and I’m talking conservatively here in less than 30 days. By significantly reducing our production time and time to market, we are just not working faster. We are becoming more responsive to our customer needs and accelerating our path a full scale rollout. By cutting our development cycles by more than half, we have turned speed to market from a goal into our greatest competitive mode.
One thing which is very clear to us is R and D will always help the company to stay ahead and remain competitive and ahead of competition. Now I would like to give an update on our acquisitions and investment so far. Our existing acquisitions and investments continue to deliver exceptional performance. For Green Edge. We saw a very strong Q3 FY26 performance achieving a revenue of 29 crores with healthy margins. Since our engagement began, Green Edge has been able to leverage the Zaggles network extremely well in scaling up their revenues for 9 months FY26 to to INR 65 crores as compared to entire FY25 revenue of around 36 crores already showcasing that how our synergies kick in.
Green Edge has also strengthened its partnership with AMEX by extending its domestic and international golf programs by another three years. Concurrently, Green Edge has strengthened its partnership with NPCI to enhance their existing benefits platform by while also developing a new suite of innovative programs. Before we go to TaxPanner, I am pleased to announce that as per the draft and these are draft Income tax rules 2026 Employee tax benefits have been extended to the new tax regime, which is a huge kicker to us in terms of not only adding more corporates to our kitty, but also to be able to enhance the entire consumer base.
In addition, the proposed rules also indicate higher permissible values for meal gifts, meal benefits gifts and certain other allowances, creating great opportunities for us. We see this to be a significantly positive development not only for TaxPanner but also for our safe business in the years to come. For TaxPanner this year has been focused on building a solid enterprise pipeline and building out products on salary structuring, tds, GST and Jacob which is for Gig Workers Wellness which has worked very well in tandem with our existing Save, Propel and Lawyer proposition. With a strong client base including Accenture, Novo, Nordesk, Bosch HCL amongst others, we expect TaxPaner to deliver significant growth in FY27.
Now I’ll come to Mobileware now Mobileware is rebranded as 86400. Since our engagement began in 2024, we have seen a massive growth journey being unleashed at Mobileware. Harnessing ZAGL’s network and credibility, 86400 has secured 11 new partnerships with banks and fintechs to date. With ZAGL support, 86400 has also onboarded several banks as customers throughout the entire period. Fueled by these partners and clients, 86400 is seeing a massive surge in its revenue from INR 17 crores in FY24 to have already surpassed INR 50 crores in YTD FY26 and we are hoping that they would cross about 65 odd crores this year.
We saw great action last quarter with the launch of the credit line on UPI products with Small Finance bank already seeing about 30 lakhs plus transactions with more than INR 50 crores being lent through the product in the first quarter itself and this will only increase in the future. Now I would like to give you an update on the ongoing acquisition. We have made considerable progress on some of these as committed earlier. I’m pleased to announce the completion of our acquisition for Rio Money now rebranded as Zag Money. This is a pivotal milestone that completes our strategic architecture.
One of the questions our investors have asked us constantly is how are you going to monetize the existing base of customers and consumers? Historically our growth has been fueled by three distinct pillars, Enterprise clients, Banking and network partners along with the merchant ecosystem. Today Zack Many establishes our fourth monetization pillar, a captive high intent base of 3.7 million salaried users. Over the past several quarters we have meticulously stitched together a wider ecosystem of retail financial products to ensure we are ready to cross sell into this base immediately. To accelerate our revenue uptick and as we had mentioned in our last con call, to reach our target of INR 500 crores for this segment within the next four to five years, we have earmarked a primary capital inclusion of about 100 plus crore.
Now I would like to give an update on our international expansion plan during this quarter. I’m happy to inform you that the Board has approved the incorporation of a wholly owned subsidiary in Gift City, Zagl Payments IFSC limited this initiative aligns with our broader vision of expanding our global cross border payments and financial services capabilities. Leveraging the Gibbsity ecosystem as guided earlier, we are in the final stages of forming an entity in UAE with a view to expand in the MENA region. We have narrowed down on Abu Dhabi as a base to set up operations from where we will build out our global journey.
Our confidence in this market is bolstered by the direct engagement with key business leaders of Abu Dhabi as well as the select stakeholders across the UAE government including the Minister of State for Artificial Intelligence. Last but not the least, I would like to take a moment to congratulate our CEO and MD, Mr. Avinash Ghodkindi who has been recognized with India’s most influential PEO Award and the impactful sunycon CEO Award. His commitment, vision and relentless focus on execution continues to inspire the entire ZAGGLE team. Also, our investment in Ayush Matre, taking him as a brand ambassador has proven to be proven to be one of the best choices we have made.
You know India brought home the Under 19 World cup and under the fantastic and dynamic leadership of Ayush Maitre and what was very, very, you know, heart, heart touching was, you know, when he raised his bag, the Zagal sticker was right there for everybody to see. Now I would hand it over to Avinash to carry on The.
Avinash Ramesh Godkhindi — Managing Director & Chief Executive Officer
Thank you Dr. Raj for your kind words and appreciation. It’s truly an honor to be part of this journey. A very warm welcome to everyone joining us on the call today. I’d like to give an overview of a few key metrics. I’m very happy to share that today around 3.7 million active users use the ZYGL powered cards and software, a strong testament to the scalability and adoption of our platform. We now serve more than 3,700 customers across a wide spectrum of industries and sectors. During this quarter our SaaS platform fees contributed to around 12 crores, program fees contributed to around 211 crores and Propel Points contributed to around 275 crores.
Now let me talk about a few business highlights on our fleet program. I’m happy to share that we have signed up with IRM Energy, a leading India cities gas distribution company with more than 120 gas stations across Gujarat, Punjab and Tamil Nadu. With this, we have gained market leadership in the CGD space with our fleet program solutions as we target our as we set our targets on the larger oil marketing companies where we have been engaging for the past few months and we hope to see positive traction very soon. I’m also happy to announce that we are seeing extremely positive traction on our SMART employee purchase program SmartPP and we have signed contracts with multiple customers already this quarter including Dubashian Consulting, Hexalog and Forever New amongst others.
During this period we also signed several other marquee clients like Senkou Gold, Biba Fashion Capital, Small Finance Bank, CISA Care, Mahindra Holidays, Rashtree Chemicals and Fertilizers amongst others. To provide a brief overview of one of our clients. A leading retail chain with more than 150 stores span India was facing significant delays on vendor onboarding as well as a complex manual process of raising procurement requests and invoices centrally and at a store level. The client also faced significant difficulty in managing audit trails and approval workflows. We address these issues by deploying our Zoya platform to streamline and digitize the entire procurement workflow while strengthening policy enforcement across the organization.
Building on our platform based strategy, we have seen excellent cross sell momentum across the organization in Q3FY26. With enhanced cross sell efforts and vigor, we were able to cross sell to multiple customers including House of Hiranandani, ck, Birla Healthcare and HT Media amongst others. I’d like to take an opportunity to elaborate further on these House of Hiran Alani was existing customers for our SAVE solution. We recognized the potential for further collaboration and successfully introduced our Zoya offering. Within Zoya we offered the Brome module to streamline their spends across their retail outlets. TK Bitla is again an existing customer for our same and Zoya solution.
We identified an opportunity to strengthen our partnership here by implementing our Zatix solution which is an analytics platform to drive greater efficiency for their spends. I’m also happy to share that we have deepened our partnership further with Visa and MasterCard. We signed a seven year agreement with Visa for co branded domestic prepaid cards which offer spend linked incentives. Similarly, we have also signed a five year contract with MasterCard for credit cards offering spend linked incentives along with referral bonuses. In addition, we partnered with Euronet Services India for co branded prepaid card solutions for our corporates.
With continued momentum across our core offerings, expanding partnerships and the strategic integration of our acquisitions, we believe we are well positioned to sustain our profitable growth. With that, I’ll now hand over the call to our CFO Aditya who will talk you through some financial updates in more detail. Thank you.
Aditya Kumar — Chief Financial Officer
Thank you Avinash and a very warm welcome to everyone on this call. On quarterly performance in Q3FY26 we delivered a record revenue of 498 crore reflecting a strong 47.9% YoY growth and 15.5 percentage quarter on quarter growth. This was largely driven by an increase in program fee followed by a strong contribution from the Propel platform revenues. The increase in incentives and cashback expenses is aligned with business expansion and higher transaction volumes. ESOP costs are being rationalized as majority of the expense has already been accrued. We expect that ESOP charge for the next year to be in the range of 3 to 4 crores.
Adjusted EBITDA grew by 62.9% to INR 51 crore compared to INR 31 crore. In the corresponding quarter last year PAT increased by an impressive 77.7% 5o y to INR 36 crore, our highest ever with margins improving to 7.2 percentage. Cash back which includes net profit along with depreciation, amortization and esop expenses stood at 46 crore marking a 76.1% YoY growth. Regarding the recent Labor Code changes as notified under the law, we expect only minimal impact on our operations. Talking about our nine month performance for the nine month period revenues from operations grew 41.4% to INR 1,260 crore.
Our adjusted EBITDA has increased by 47.5% of yoy to 128 crore. Notably our cash PAT has already surpassed full year FY25 cashback with a strong 68.3% yy growth reaching to INR 121 crore. On working capital we are well on track and as guided we will see breakeven for FY26 and OCF turning positive in FY27. With that I would like to conclude my update and we are happy to open the floor for questions. Thank you.
Questions and Answers:
operator
Thank you very much. We will now Begin the question and answer session. Anyone who wishes to ask question may press star and one on the touchdown telephone. If you wish to remove yourself from question queue you may Press Star and 2. Participants are requested to use hands as asking a question. Ladies and gentlemen, wait for a moment while the question give a semblance. The first question is from the line of Devesh Kasliwal from NTECH Stockbroking. Please go ahead.
Devesh Kasliwal
Thank you. Congratulations sir on a good set of numbers. Just wanted to check in the consolidated segmental revenue. We have our platform fees as around 79 crores. So that is a substantial jump from 12 crores. So I just wanted to understand why that jump is and bifurcation between organic and inorganic in that very small change.
Aditya Kumar
In regrouping that has been the new updated financials have re updated in stock exchanges.
Devesh Kasliwal
Oh, okay, okay. Not a problem. Second thing was I wanted to understand the business as well as economics of the lease and the procure and lease mobile phone. That smart EPP that you’re talking about, just how does it work and how are we making money? The overall economics on that front.
Avinash Ramesh Godkhindi
Yeah, thank you for that. I think there’s substantial margins there simply because there’s a lot of benefits that you get in terms of savings both on the income tax as well as the gst. And our commissions are also fairly thick if I may say that on that program. It’s a highly profitable program for us.
Devesh Kasliwal
So the working capital is used by us in this. We are procuring them on our books. Will these be as assets and then we’ll be leasing it out to the employees of the company that we have signed a contract with you. Am I right on that?
Avinash Ramesh Godkhindi
No, no. There’s no working capital deployed from our end. The leasing partners are partners like Tata Capital. We just signed up and we announced in the investor deck as well Geo Finance. So this leasing would be done by leasing companies and we have zero working capital that gets deployed in this solution whatsoever.
Devesh Kasliwal
Okay. Okay, got it. And last question from my side just wanted to. And I know you don’t disclose the cash flow from operations at the end of third quarter but given last quarter was festive and we were giving points or like to our customers. Just wanted to understand how much of that has already converted into cash in the current quarter. If you could give some number on that.
Avinash Ramesh Godkhindi
Yeah, we are back on track and we are on track with our guidance that Aditya also shared that you know we’ll break even for sure by the end of this year and next year we hope to be significantly OCF positive.
Devesh Kasliwal
Okay. Okay, got it sir. Thank you so much.
operator
Thank you. Thank you. Ladies and gentlemen, in order to ensure that management is able to address questions from all the participants in the conference, please limit a question to two questions per participant. Do you have a follow up question? We request you to rejoin the queue. The next question is from the line of Deepak Podar from Supplier Capital. Please go ahead.
Deepak Poddar
Yeah, I’m audible, sir.
Avinash Ramesh Godkhindi
Yes, yes. Yeah.
Deepak Poddar
Thank you very much for this opportunity. So I’m just wanted to understand the employee cost in this quarter, quarter and quarter it was higher by about 3.2 crores. I mean is there any one off there? I mean what led to the increase?
Aditya Kumar
So there are some one off payments which were given to certain employees in terms of the regrouping of the structure. But this is not linked to the new labor code impact etc.
Deepak Poddar
So what is the amount?
Aditya Kumar
The amount is around 2.1 crores.
Deepak Poddar
So 2.1 crores. So, so I mean going into next quarter. Yeah, yeah, 2.1 will not be there. Okay, okay, understood, understood. And in terms of free cash flow generation, I mean you mentioned fourth quarter, will, will cash break even and from FY27 will have cash positive, right?
Aditya Kumar
Absolutely. That’s what we have communicated.
Deepak Poddar
Yeah, understood. And in terms of, I mean margins we have iterated in the past as well a 1% kind of quarter yoy increase for next three to four years to have eventual target of 14 to 15%. So I mean this year, I mean if you exclude ESOP cost, our margins is we’re not looking at 100 basis point improvement. Right. So where do we see it?
Avinash Ramesh Godkhindi
See the 100 basis points was never going to be, you know, a linear step up function and that we sort of clarified as well. So there’ll be some years where the growth is much higher. Like right now we are seeing on a much higher base. We are seeing very, it may be. Lower but overall our guidance has been that we’d been adjusted EBITDA of about 14 to 15% in about five to seven years is what we’ve guided along with a billion dollar of revenue. That’s been our guidance. So let’s see where we land at the end of the year. But you know, the margin expansion is quite significant as we are seeing and the momentum is strong there. Okay, so.
Deepak Poddar
So you’re saying five to seven years, one billion dollar revenue with 14 to 15% margin rate.
Aditya Kumar
Great.
Deepak Poddar
Okay, okay. And I mean in terms of revenue, CAGR this 40, 50% that we are expecting for this year. Right. FY26. So that CAGR we can, I mean that’s the CGI we should look at over next three, four years.
Avinash Ramesh Godkhindi
See the guidance that you’ve given a 40 to 45% growth for this year is all organic, all domestic. This doesn’t include the growth that we are seeing in our acquisitions. Like. I wouldn’t hazard a guess whether the next year growth would be the same. Higher, lower. Right now our guidance stands for this year. But as I mentioned, it’s only domestic and it’s only organic. So there’s a lot of hopefully upside that comes in from both the international opportunities as well as the acquisitions in the coming years. Correct, Correct.
Deepak Poddar
I got it. I got it. I think that’s very helpful, sir. I wish you all the very best. That’s it from my side. Thank you.
operator
Thank you. The next question is from the line of Sachin Dishthink from GM Financial. Please go ahead.
Sachin Dixit
Hi Avnach and team. Congratulations on a great set of the bills. My first question was on this customer win side. So you guys do highlight significant number of customer wins happening during the quarter in multiple press releases. Is there a way for us to read this? Is there a way for us to think of it in numbers? I mean if you can provide any color on that piece will be really helpful.
Avinash Ramesh Godkhindi
Yeah, I think customer wins, the ones that we speak of are typically the ones where we see significant growth potential in those accounts in the coming years. Right. So these are larger contracts, more important contracts for us strategically as well where there could be more cross sell and upsell. Beyond that. Sachin, it’s very hard for us to give a rupee or a dollar number on our contracts because the nature of the business being SaaS, it’s very dynamic as to how much is the usage of the platform. And similarly on the transaction side, we cannot necessarily predict how the spends of the company would be for the coming month or quarter or year.
And that’s where a lot of the upside also comes because many times the buoyancy is there in the business and customers business and that reflects in our numbers. So that’s. There’s an upside to that as well.
Sachin Dixit
Just a request, if it’s possible, maybe if we can do some sort of quantization data on customers and start sharing that in accordly DBT for people to see how, how the existing customers and new customers are ramping up on the platform might be helpful. My second question is on the Rio money side and the acquisition side. Any update there on where we Stand in terms of doing these, ramping up those businesses.
Avinash Ramesh Godkhindi
Yeah. So on Rio, the transaction is closed. The company has now been rebranded as Zag Money from Rio Money. So the cards are now in the market. Co branded cards with yes bank are now branded with Zag. The whole idea is to be able to leverage the large employee base, about 3.7 million active users on the Zagg platform which keeps growing, and our access to a much larger employee base through our corporate customers. As we clarified multiple times in the past, it’s very rare that if A company has 100 employees, all 100 employees are on the Zaggle platform and using it because all of them may not be filing their reimbursements, etc.
But we have access to that entire base of employees through our strong relationships with these corporates. And we leverage that to be able to reach out to a much larger audience in a much more cost effective manner. And the draft IT guidelines and regulations again provide a great fillip to that. Because now with the new tax regime, also including the meal allowance, the gift allowance and fuel allowance and all the other allowances, obviously a lot more employees from marquee customers would sign up to be part of the Zagl platform. And that we believe we can translate into a retail card customer as well in addition to the TPAP capability that we bring.
So that’s the thesis and this has been a very fortuitous break with the NTR new tax regime also including these wallets. Now.
Sachin Dixit
Monetization wise, this will again be an MDR LED monetization or we also have some extra fees arrangement with our partners.
Avinash Ramesh Godkhindi
We have both fees as well as spend. Linked Interchange, Linked income here.
Sachin Dixit
Thank you and all the best.
Aditya Kumar
Thank you.
operator
Thank you. The next question is from the line of Ankush Agarwal from Search Capital. Please go ahead.
Unidentified Participant
Yeah, hi, thank you for taking my question. So just going back to the first question that was asked around Consolidated software. Fee being around 79 crores. What did you clarify on that?
Aditya Kumar
Like I said, it’s an numerical error. The revised financials are being uploaded to stock exchanges.
Unidentified Participant
Okay, okay, got it. Secondly, if I look at our incentive. Cost as a proportion of program fee. That number has probably been around 66, 67%. So like how are we looking at. That number changing in the long run? Do you believe it will stabilize at. This number or over time as the. Growth sort of moderate on the program fee, we can expect some kind of. Leverage on that number?
Avinash Ramesh Godkhindi
Yeah, absolutely. There is a lot of opportunity there for that number to come down in the coming years. And we estimate the steady state in about, you know, five years would be in the range of about 50% there or thereabouts as a percentage of program fees.
Unidentified Participant
Okay, but if that is going to happen, like if that is going to. Come down from 67% to 50%, shouldn’t. Be our margin outlook be much higher? Because that is the biggest part of, if I look at net revenues, that’s like 58, 59% of our overall cost. Now
Avinash Ramesh Godkhindi
see, look, we always try to give you a conservative view on our projections. You’re absolutely right that there is potential much higher upside. But there is also the possibility that some of our other costs would also over time increase. Right. So we don’t want to give you a view which is very overtly optimistic. But yeah.
Unidentified Participant
That is it. Thank you.
operator
Thank you. A reminder to all the participants, you may press Star in one to ask question. The next question is from the line of Srinak Mehta from Indowealth. Please go ahead.
Unidentified Participant
Hi, good afternoon. So I wanted to check on a little bit of a longer term view. So we have fantastic growth in the last few years, but in spite of this growth, we are probably looking at negative or a very low cash from operating activities. And we still have a fairly low number as far as the ROE of the company is concerned. So if you want to have a situation where you can get a compounder, which is say 30, 35% kind of a compounder over the long run, which certainly looks to be the case here, you would need to raise this ROE closer to 25, 30% and also have a very high ratio of the operating cash.
So I know it’s a very rapid growth phase, but do you see a situation where we are able to see these numbers over the next few years? What’s the glide plot that you look at?
Avinash Ramesh Godkhindi
Point Very well taken, sir. I think you’re absolutely right. These are matrices that we internally focus on. Whether it’s, you know, operating cash flow or the roe. Some of that obviously will improve with the deployment of capital that we raised. Some of the investments have been extremely successful, like Green Edge, where we’re seeing a fabulous performance by the company and spectacular returns. And we hope to deploy that capital sooner than later to be able to generate outsized returns in the coming years. So we are acutely aware of the need to deploy that capital in a very effective manner and we are at it.
Unidentified Participant
Okay, you want to put some frame to it, like four years, five years or more than five years, something in that range or I think all these.
Avinash Ramesh Godkhindi
Matrices go hand in hand. So whether it’s the top line growth, whether it’s margin expansion, whether improvement in roe roce and cash flow, all of these over the course of that five year horizon would improve substantially because the business right now is in a hyper growth, high growth phase. And as the business captures more market share and we become much more established, not just domestically but across markets, a lot of this operating leverage and you know, those sort of things start to kick in in a big way.
Unidentified Participant
Yeah. Okay. And the second question was about the use of AI. So you’ve mentioned this in your presentation as well. Any specific one major use case that you could share which could demonstrate a significant, you know, benefit to the company already, which is getting accrued.
Avinash Ramesh Godkhindi
So a lot of work is happening in reconciliation to automate reconciliations.
Unidentified Participant
Okay.
Avinash Ramesh Godkhindi
Reconciliations are most painful in this spend management universe. And in general, typically if you talk to any cfo, she’s likely to say recon is a major concern or headache. And especially when you are a large enterprise, which is the case with a lot of our customers, there are multiple systems and platforms that they have and those generate, you know, outsized amount of data and to make sure that they are all in sync. And you know, recon is a fairly elaborate process. So the amount of manpower that gets deployed in doing it is also outsized. And you know, there are a lot of reconciliations that you have with your payment systems, with the ERP data, some other data that you might be getting from your CRM, etc.
So all of those recons in the coming years will be able to get it done through the agentic AI platform and the AI capabilities.
Unidentified Participant
Okay, wonderful. So congratulations again for great set of results. Keep up the great work.
Avinash Ramesh Godkhindi
Thank you. Thank you so much.
operator
Thank you. The next question from the line of Rohan AM from Aquarius securities, please go ahead.
Unidentified Participant
Good evening sir. Thanks and congratulations. Good set of numbers. Just to reconfirm the disclosure that you’re changing that control numbers for propel revenues is also getting updated.
Avinash Ramesh Godkhindi
Yes.
Aditya Kumar
Yeah, so that’s Propel numbers are getting updated as from this quarter onwards. There’d be consolidation from green edge numbers too. That got into.
Unidentified Participant
And I just want to understand what is the take rate in green edges gift card business and what proportion of its revenue is coming from gift cards.
Avinash Ramesh Godkhindi
So basically in greenage the business is golf privileges and NPCI privileges. Right. So that’s a lot of redemptions that the plat and select credit cards and debit cards, base of rupee which is growing Rapidly these are points given to cardholders linked to their spends and they redeem it for vouchers and other privileges like golf etc. So within. This is not, you know, too much of the gift card part of it, Rohan. But of course there is some. Some consumers still try to redeem it. For a gift card.
Unidentified Participant
Sure. So I was just trying to mention if we consider these golf privileges and other is a cost, what was the net take rate in that business? Just on a console basis, how should we look at the net revenue in the propel business adjusted for the cost of acquisition or servicing of these incentives or the benefits to customers?
Aditya Kumar
So as you’re aware, as per Inda, yes, we have to do the similar accounting whatever. We have to do it in zaggle gross revenue basis. But. But what we have done is we. Started to give to investors and readers on net numbers basis in our investor presentation as well. So we will do the similar thing. To Greenwich numbers too.
Unidentified Participant
But the presentation is on standalone I believe.
Avinash Ramesh Godkhindi
Yes, yes, yes. So to answer the question Rohan, the margins there are higher because golf is a very super premium category higher than the propel points margin that we make on vouchers there the margins are much, much higher.
Unidentified Participant
Got it. And like Last year in 4Q do we expect volume incentives also to come in? Because this year the take rates and gift card has been around 4.8% in nine months. It was 4.1 last year. So just wanted to check there.
Avinash Ramesh Godkhindi
Yes, yes, yes. Some of the orcs have started to kick in this quarter. This quarter as in Q3 overriding commissions that we get for hitting thresholds with merchant brands and some of them will come in in the next quarter.
Unidentified Participant
Got it. And just want to understand your thought process on branding and what kind of annual budget should be run because as I understand probably we are also advertising in World cup also. So this may have an impact on 4Q OPEC. So just want to get a thought and next year how should one think on this cost?
Avinash Ramesh Godkhindi
No, I think the branding is as an investment is something which we see us doing in a very calibrated manner, Rohan. And any of these opportunities that we tap into are done with extreme care to make sure that the return on investment is outsized. We are very particular that you know this. Either overall size of investment is very reasonable and B the returns are outsized.
Unidentified Participant
And lastly the increase in depreciation. There’s no one off this. Will the steady state incrementally. Okay, sure. Thanks.
operator
Thank you. The next question is from the line of Piyush from Narang family office. Please go ahead.
Piyush
Hey. Hi team. Congrats on great set. The first one is on acquisitions. So anything nearing term sheet and what’s the update on the other ones? DICE and other ones.
Avinash Ramesh Godkhindi
So as we mentioned dice, we are on the cusp of closure so we should be closing that transaction very soon. And other term sheets etc we let you know as things play out you’ll hear from us.
Piyush
So anything in this year or it’s going to be next financial.
Avinash Ramesh Godkhindi
I wouldn’t want to make any commitments on the call here but as soon as we sign of course.
Piyush
Sure. The second one is on any qualitative commenting you want to give on current take rates. Where are they moving and what kind of a growth do we see in the GTV spend on our platform? So any color you want to give there that how we are seeing the payments on UPI from our platform?
Avinash Ramesh Godkhindi
Yeah, I think the good part about UPI payments is that overall there’s a realization in the ecosystem that UPI cannot be subsidized by the government forever. So already there’s interchange on credit cards which is a full interchange for transactions about 2000 and prepaid there’s an interchange for 1.1% for transactions about 2000. And our belief is that in the. Coming. Years as UPI becomes more and more ubiquitous, we are only going to see that take rates go up across board because this has to be ultimately self sustaining and not based on subsidies from the government. So that’s something which we are seeing the trend as well in the ecosystem.
Piyush
And what would be the current ticket are there par to our TBS 1.85 is what I understand.
Avinash Ramesh Godkhindi
Yeah. So that’s, that’s where we are.
Unidentified Participant
Okay. The next one would be on cash flows again. So when we say we’ll be operating cash positive next year, what would be our EBITDA to OCF conversion next year? Will it be north of 50 or would be lower?
Avinash Ramesh Godkhindi
Too early to for us to say sir right now. But our endeavor would be to be in in that space too early for us to commit and comment anything.
Piyush
The last one would be on again the tam. Do you see newer areas opening up besides or for your boom or other something more on Zoya new markets, new sectors opening up for that or you think the current itself is big enough for you to keep penetrating?
Avinash Ramesh Godkhindi
I think for Zoya there’s always a massive market because the number of vendors keep growing. Right. And the payouts that happen from corporates to vendors keeps growing. So that’s obviously There we’ve already spoken of our aspirations and work that we are doing to enter into the GCC and our establishment of our setup in UAE with Abu Dhabi as the base. So those would be newer markets opening for us and GCC is the start. We’ll obviously, once you’re able to do a good job there, expand into other markets as well. Right. So TAM has never been a problem for the space, neither for us nor in other global markets. Just about capturing the market and doing it in a profitable manner in a rapid pace.
Piyush
Sorry, if I can squeeze in one more. Anything on competitive intensity you want to call out or. This is a new market being created by Jaliyah.
Avinash Ramesh Godkhindi
I think. See, competition has always been there. We are solving a set of problems which are deep and hard and we are doing it in a tech first, AI first manner. And I think scale is critical because that scale gives you efficiencies, scale gives you institutional knowledge and learning of the kind of problems that customers face. And you are able to solve that using AI even before those problems occur to the customer. You’ve already preempted those leakages from happening. Right. And that’s something where customer delight comes from. So those are things which we stand out.
And when we see a particular problem that comes up with a customer because of the scale of the business and the number of customers that we have, when we solve it for one, we are able to take it back to the remaining 3,700 customers and say, hey, without naming that customer, we said one of our customers had this problem. This is how we solved it. Do you think you also potentially see this as something useful and many, many adopt it because they don’t want to have the same leakages and problems as others do.
Piyush
Thank you.
operator
Thank you. The next question is from the line of Daksh Malhotra from Adrive Global. Please go ahead.
Unidentified Participant
Yeah, good evening and congratulations on a good set of numbers. Definitely met the expectations on various fronts. So I just wanted to ask, as you know, Mr. Raj in his opening comments mentioned the way IT industry has gotten beaten down, especially in the last few days given the anthropic AI model and you know, Jeffrey’s terming it as a sassocalypse and you know, they are saying that even the software, you know, the SAS model can entirely be done by AI and different plugins. Just your view on the overall scenario on how while we are using AI and you mentioned about how it can be used in reconciliation activities and bigger companies, but how are we sort of placing ourselves against these things? That would be the first question.
Raj P Narayanam
Thank you so much. So, you know, my opening comment was basically, you know, in relation to the services, you know, India has always been, you know, a services mindset and not a product mindset. Okay? If you look at, you know, this versus agent tech, let’s say, you know, that’s an intellectual discussion we are doing right now. What does SAS do? SAS builds workflows, makes rules workflows, and then a decision tree. This is what SAS does in any of the applications. Now all of those possibly can be done by the agent, AI, where you train the agent to do these activities, basis, certain parameters, then what will happen? The application will remain as it is, except all the coding which has been done has moved to an agent, okay? So if you are able to build an agent, you have been able to solve the problem.
So they will be able to do the workflows, they will be able to do the hierarchy, they will be able to do the decision tree making and also build the solid logic, okay? Logic is what today, you know, differentiates an application from a fast application. Because SAS application has lot of logic in it, okay? Now today, from tomorrow, you are transforming that logic into a agent, okay? Agent is doing the workflow hierarchy, decision tree, etc. And plus the logic part of it. So that’s the change which we see for Zaggle. The product would remain as it is, okay? And in the product, the work will be done by the agent.
So for us, because we are a SaaS and FinTech company, this is hugely beneficial. I’ll give you a very small and a quick example that today, you know, any feature which we have to do, which is, let’s say, for example, you know, doing 18 workflows, okay, one single feature, you know, that typically would take about 75 to 80 days, you know, to develop, then deploy and test, and then deploy today we are able to do it in less than 30 days. And to be very candid with you, you know, as we improve, we should be able to do it in less than 10 days, okay? So that’s the efficiency, which is from 80 days.
If it comes down to 10 days, you imagine the A, you are able to reach to the customer faster, B, you are able to also see that the cost of production of that particular feature is much lower. So there are benefits both ways. And if you see we have considerably downsized, you know, our IT team, okay? Keeping in mind that, you know, more and more AI we are using, the better results we are seeing. And today with, you know, Claude code Which has just been released or you know, anthropic dopas. It’s on the platter for you now.
And it will only improve. It will not go back. You know, this is what we have been saying for the last one, you know, year or so that R and D will have to spend a little bit money. But you know, this would help us in becoming better in the future. And what I see in next six to nine months, this will only accelerate.
Unidentified Participant
Okay. So basically for us this will be more of a tailwind given our nature of a fintech business. Also we can reduce our headcount and yeah,
Raj P Narayanam
200%.
Unidentified Participant
Not a threat in any way for our organization. For Zagat.
Raj P Narayanam
Oh no, no, no. In fact, you know the. If I have to very candidly tell you that entry level jobs, you know, we used to do, let’s say a form we had to build, we will tell, you know, a programmer, okay, build this, you know, developer, build this form, you know, to build one form or you know, he’ll take about four days today we do it under ten minutes.
Unidentified Participant
Right, right. Very helpful. Sir, just one more question given and I understand people have asked the cash flow question and working capital question, but given the rapid growth we are seeing and we have relatively raised cash by diluting little bit of equity in the past, are we planning to dilute any. More. In the time to come?
Raj P Narayanam
You know, not really. Not looking at diluting any equity right now. We have enough cash in the bank and the deals which we are looking, we just want to do a good deal as we have done in the case of mobileware or Green Edge or taxpayer. Just want accretive deals for us. Looking at their growth rates, we are amazed that they had the propensity to grow at that pace and they were not growing. And with that help and support they are doing so right now. Not looking at diluting any equity. We have raised enough money, in fact more than what we wanted to raise at that point of time and self sufficient right now.
Piyush
Right. So because I saw that we have some 400 odd, 445 crores odd cash in our hands from the previous days. And so yes, that’s sort of, I think a big concern at the street that we are diluting. We are not getting enough positive operating cash flow and diluting or raising equity to get our cash flow needs met, which probably is acting negative against our.
Raj P Narayanam
We raised money, you know, which was in December a year back, you know, roughly 14 months. And you know, we have not, you know, post that we are only looking at Great opportunities. That money was also raised purely for acquisition purposes. And that’s what we have been constantly looking and it’s a process. Now we have operating leverage will kick in. We’ll again reach one stage where may we, you know, may use some of this 445 crores, you know, there and then again, you know, we will reach one more level. Imagine you know, we were 371 crores when we went to, you know, in 2023.
Today, you know, we roughly will close at about 17, 1800 crores. You know that’s like 5, 5x jump, you know, which has happened in less than, you know, three years.
Unidentified Participant
No commendable, sir. On growth it is commendable just that, you know, we put some, we don’t press the brake but we put press the clutch on the growth and just press the pedal on the cash flow so that the whole economics looks better. Just that. Thank you very much.
Raj P Narayanam
Is that the idea and thought is that. And you know, we’ll work each process, you know, it’s not like one shot will solve everything. We just need to play it a little bit neatly and deeply and then we’ll reach. We are very, very much aware of the concerns on positive cash flow. And every day, trust me, we are working on it to make it happen.
Unidentified Participant
Thank you so much sir. Wish you guys all the very best. Thank you.
operator
Thank you. The next question is from the line of Rudraksh Kala from MB Investment. Please go ahead.
Unidentified Participant
Hi, good evening. Firstly I’d like to congratulate the management for posting a good set of numbers. I did a comparison and the top line is up 15% Q on Q but the PAT is only up in the ballpark of 9 to 10%. We’ve also seen a sharp uptick in cashback and incentive spends. Can you explain this? What drove this and whether it’s a one off or a continued trend and if it’s a one off trend, when do we expect it to normalize?
Avinash Ramesh Godkhindi
So we look at our business from a yoy basis because there is seasonality. So the Q on Q numbers don’t necessarily educate the that much, to be very honest. Having said that, you know, there is seasonality. Q3 being a critical quarter for us does include some, you know, significant incentivization as well. And I would urge you to look at the incentives in line with, you know, what the historic numbers have been.
Unidentified Participant
So going forward, is it a continued trend or is it gonna, you know, even on a QI basis.
Avinash Ramesh Godkhindi
Gradually, of course. As I answered in the previous Question. We see in the medium term this coming and, you know, stabilizing it about 50% as a percentage of the program fees. Right. That’s where we are headed towards. But right now, this is a space where we are growing rapidly. So that’s, that’s why we are seeing this to be at these levels of about 67%.
Unidentified Participant
All right. Also, could you share an update on collections and cash inflows from already realized. Business deals for particularly contracts where work is completed and what is the cash conversion or are we expecting it in the next quarter or not?
Avinash Ramesh Godkhindi
See work done. We are not a services company, so that work done approach work is never done for us because we are constantly enhancing our products. So there are, of course, you know, customers who are going live every day and that’s a cycle that completely depends on the nature of the complexity of the product and what product they choose from our platform.
Unidentified Participant
Fair enough. Thank you so much. I wish you guys the very best for your future endeavors. Thank you so much.
Avinash Ramesh Godkhindi
Thank you.
operator
Thank you. As that was the last question for the day, I would now hand the conference over to the management for closing comments. Over to you, sir.
Raj P Narayanam
Thank you all for participating in today’s call. We hope we have addressed all your queries and provided valuable insights. We remain optimistic and focused on the future growth and the profitability of the company. And we are excited about the opportunities ahead. For any further information, we request you to get in touch with sga, our investor relations advisor. Thank you and have a nice evening.
operator
Thank you. On behalf of Zegal Prepaid Ocean Service Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines. Thank you.