Zaggle Prepaid Ocean Services Limited, a fintech company, made its debut on the BSE and NSE during a special pre-open session on Friday. Interestingly, while Zaggle’s shares opened at ₹162 on the BSE, they were listed at ₹164 on the NSE, signaling a discount on the BSE listing compared to par listing on the NSE.
Experts in the stock market have noted that Zaggle is a profitable company, but it has experienced a decline in margins over the past three years. This suggests that despite increasing its business volume, the company has struggled to improve its profit margins. As a result, experts recommend waiting for the Q2 results of the financial year 2023-24 and setting a stop loss at ₹156 per share, which represents the lower price band.
Avinash Gorakshkar, Head of Research at Profitmart Securities, commented on Zaggle’s IPO listing, stating, “Zaggle Prepaid Ocean Services Limited is one of the rare fintech companies that is profitable. The IPO listing may have fallen below expectations, and my advice to allottees is to await the upcoming quarter’s results. This listing could be attributed to the high valuations of the public issue and the weak sentiment in the stock market. Some upside potential is expected once there is a trend reversal on Dalal Street.”
For those who missed out on acquiring Zaggle shares during the allotment process, Arun Kejriwal, Founder at Kejriwal Research and Investment Services, advised caution. He mentioned that while Zaggle has seen a rise in volumes, its margins have declined over the past three years, raising concerns about the company’s financial health. However, given its status as a fintech company and its high valuation during the IPO, Kejriwal suggested that allottees should hold the stock with a stop loss at ₹256 levels. He also recommended avoiding fresh positions in the company’s stock due to its mixed financial performance.
It’s worth noting that Zaggle’s IPO received strong interest from investors, with a total subscription of 12.86 times. The retail category was subscribed 6.15 times, the Qualified Institutional Investors’ (QIB) category saw a subscription of 16.94 times, and the Non-Institutional Investors’ (NII) category reached a subscription of 9.16 times.
