Fintech Startup Zaggle Plans More Acquisitions in 2025, 3 Buys on The Cards by March 2025

Zaggle, a fintech SaaS startup that funded about INR 595 crore through a qualified institutional placement (QIP) last week, plans to make three new investments and acquisitions by March 2025 to increase its capabilities and top line, according to a media source.

Zaggle, founded in 2011 by Raj Narayanam, now offers enterprise solutions for costs, payments, and corporate employee perks. Zaggle Save, Zaggle EMS, and Zaggle Propel are among its SaaS offerings.

According to the source, Zaggle will only buy companies that are extremely EBITDA accretive.

Zaggle is in talks to purchase a company that provides merchant services. According to the source, the target firm has an EBITDA of roughly INR 45 crore and will further boost Zaggle’s products. The entity’s name was not disclosed.

Zaggle’s initiatives and acquisitions will help it achieve INR 2,000 Cr gross sales and INR 150 Cr to INR 200 Cr net profit in FY26.

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Zaggle made a net profit of INR 44 crore in FY24 on an operating revenue of INR 775.6 crore. It is worth noting that, in presenting its Q2 FY25 results, Zaggle restated its target of 50-55% top-line growth for FY25. This corresponds to around INR 1,050 crore in income for the current fiscal year.

Zaggle’s consolidated profit after tax (PAT) increased by 167.67% to INR 20.29 crore in Q2 FY25, up from INR 7.58 crore the previous year. Revenue from operations increased by 64.21% to INR 302.55 crore from INR 184.24 crore in Q2 FY24.

The company claims to have issued 50 million prepaid cards in India through partner banks, serving over 3 million customers.

Zaggle presently has over 3,200 corporate customers and expects to sign over 200 additional contracts with corporations in the next months, according to the source.

Aside from extending its solutions, the fintech SaaS business plans to improve its cross-sell rate to around 45% over the next three years, up from 20% today, to reach INR 5,000 crore in revenue.

The statements come as Zaggle is already on a growth trajectory. In September, it paid INR 32.07 crore for a 98.32% stake in Span Across IT Solutions, followed by INR 15.6 crore for a 26% investment in Mobileware (now known as ‘86400’).

In its second-quarter investor presentation, cofounder and chairman Raj Narayanam stated, “As part of our growth strategy, we are actively seeking strategic alliances and inorganic growth opportunities.” We are heavily focused on M&As in the SaaS fintech sector, encompassing areas such as NBFC and payments, using a combination of minor tuck-ins and larger investment opportunities.”

In accordance with this, the business intends to use a significant portion of the QIP proceeds for acquisition. It intends to employ INR 375 crore of the INR 595 crore raised through the QIP for strategic investments, acquisitions, and inorganic growth opportunities. INR 175 crore will be used in FY26, and INR 200 crore in FY27.

Zaggle’s shares have risen 232.28% since their IPO price of INR 164 in September last year, owing to robust revenue and bottom-line growth. The stock closed Tuesday (December 24) 2.78% higher at INR 544.95 on the BSE. The stock is up roughly 150% year to date.