One Mobikwik's financial Services revenue declined 23%/64.6% QoQ/YoY due to continued scale down in small ticket BNPL (ZIP) biz., and BNPL's gross merchandise value declined 50% QoQ. However, lender comfort is relatively better in longer tenure ZIP EMI, where GMV posted a robust 32.5% QoQ growth.
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Dolat Capital Report
One Mobikwik Systems Ltd.'s reported revenue of Rs 2,618 million, a decline of 0.6% QoQ (our estimate:+9%), due to steeper-than-expected rampdown in BNPL disbursals. Financial services revenue declined 23% QoQ, but Payment services grew 7.7% QoQ.
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Management projects strong growth in its Payments segment, (added 4.5 million users/76,000 merchants) driven by the stable economics of Pocket UPI, while Fin. Services biz. faces front-ended cost pressure from DLG provisioning; however, a recovery is expected in H2 FY26.
Due to the ongoing impact of Fin. services biz., we now expect PAT loss in FY26 (vs positive PAT earlier), and lower FY27E earnings by 15.6%. However, growth opportunity from payments rail and financial product distribution would accelerate as IPO proceeds get deployed on growth strategy.
Maintain ‘Buy' rating with revised target price of Rs 500 (implies 1.6x E.V/Sales or EV/Ebitda of ~55x on FY'27E estimate).
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