Why Zaggle shares fell nearly 10% today despite strong Q4 profit and revenue growth

Zaggle Prepaid Ocean Services shares fell nearly 10% on Thursday, May 14, even after the fintech SaaS company reported strong growth in Q4 FY26 profit, revenue and operating performance.

The stock was trading at Rs 256.62, down 9.59% or Rs 27.23 as of 9:26 AM. Zaggle shares opened lower and moved in a day range of Rs 252.20 to Rs 268.34. The previous close stood at Rs 283.85. The stock has a 52-week range of Rs 186.05 to Rs 469.80, while the company’s market capitalisation stood at Rs 34.46 billion.

The fall came despite Zaggle reporting a 30.4% year-on-year rise in consolidated net profit to Rs 40.6 crore in Q4 FY26, compared with Rs 31.1 crore in the same quarter last year. Sequentially, profit rose 9.4% from Rs 37.1 crore in Q3 FY26.

Revenue from operations increased 49.9% year-on-year to Rs 617.9 crore, compared with Rs 412.2 crore in the year-ago quarter. On a sequential basis, revenue grew 17.6% from Rs 525.5 crore in Q3 FY26. Including other income of Rs 7.7 crore, total income stood at Rs 626.3 crore during the quarter.

The company’s operating performance also improved, with adjusted EBITDA rising 62.4% year-on-year to Rs 60.5 crore. EBITDA margin improved to 9.8% from 9% in the year-ago quarter.

However, investor sentiment appeared to weaken due to the sharp rise in expenses. Zaggle’s total expenses increased 49.6% year-on-year to Rs 573.7 crore in Q4 FY26. Incentive and cashback costs also rose sharply to Rs 152.1 crore, compared with Rs 108.3 crore a year ago.

The company said cashback expenses are expected to keep rising until the cohort matures and until the natural expectation of cashback subsidies by customers reduces. This cost pressure may have weighed on the stock despite strong headline growth in revenue and profit.

For the full FY26, Zaggle reported 57.9% year-on-year growth in profit to Rs 138.6 crore, while revenue from operations rose 46.3% to Rs 1,907.6 crore. Annual adjusted EBITDA improved 51% to Rs 191.6 crore.

Zaggle also projected 25 to 30% standalone revenue growth and around 40% consolidated revenue growth for FY27, driven by AI, international expansion and deeper monetisation across its ecosystem.

Overall, Zaggle shares moved lower as investors focused on the sharp rise in total expenses and cashback-related costs, even as the company delivered strong Q4 revenue, profit and EBITDA growth.

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