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ICICI Securities Report
Pine Labs Ltd.'s shares are likely to be in focus after ICICI Securities initiated coverage on the stock with a ‘Buy' rating, citing strong growth visibility, a diversified business model, and operating leverage-driven earnings expansion.
The brokerage has set a target price of Rs 210, implying an upside of around 36% from the current market price of Rs 154.
Key Investment Thesis
Pine Labs is a diversified payments platform comprising ~30% revenue mix each of subscription, affordability, issuer distribution and processing as of FY26, along with other fast-growing segments like online and credit card processing. The breadth of these services gets meaningfully enriched when juxtaposed with increasing international footprint and possible synergies with brands, alongside opportunities presented by AI in payments.
While product capability and diversification could help Ebitda growth, margin prospects remain healthy with an increasing mix of higher-profit segments. This, along with operating leverage, could ensure ~19%/37%/75% compound annual growth rate in revenue/Ebitda/earnings over FY26-30E.
The brokerage expects this to lead to more than ~Rs 1,000 crore PAT in FY30.
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