Summary
One MobiKwik Systems Limited - Q3 FY 2026 Earnings Call Summary Tuesday, February 03, 2026, 4:00 PM IST
Event Participants
Executives 2 Bipin Preet Singh (MD & CEO), Upasana Rupkrishan Taku (Executive Director & CFO)
Analysts 8 Ankush Agrawal, Atul Ghodse, Deepak Poddar, Rahul Jain, Ram Sinha, Sanjay Chawla, Sanjay Ladha, Smit Shah, Umang Patel
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Payments GMV | ₹48,100 crores | +63% YoY and +11% QoQ; 12th consecutive quarter of record highs driven by UPI and Wallet growth. |
| Total Income | ₹297.2 crores | +8% YoY; reflects steady growth despite a tightening in unsecured lending and pivot from BNPL. |
| Contribution Profit | ₹128.8 crores | +76% YoY; improvement driven by margin expansion in both payments and digital lending. |
| EBITDA | ₹15 crores | Swing of +₹57.6 crores YoY; reached a 5% EBITDA margin as the company returned to profitability. |
| PAT | ₹4 crores | Swing of +₹59 crores YoY; first quarter of PAT profitability in FY26 as per management commitment. |
| Payments Revenue | ₹223.7 crores | Growth supported by wallet and bill payment categories despite UPI’s rising share in the mix. |
| Net Payment Margin | 17 bps | Expanded from 13-15 bps range; attributed to sticky wallet users and high-margin bill payments. |
| Digital Credit GMV (Disbursals) | ₹900 crores | +126% YoY for ZIP EMI; however, overall disbursals remain lower than historical highs due to exit from BNPL. |
| Financial Services Gross Profit | ₹37.2 crores | +405% YoY and +45% QoQ; driven by enhanced credit quality and a 57% YoY reduction in lending expenses. |
Geographic & Segment Commentary
- Consumer Payments: Achieved record GMV of ₹481 billion, with UPI transactions growing 3.2x YoY. The segment focuses on “Pocket UPI” (wallet over UPI) to drive stickiness and cross-sell high-margin bill payments, maintaining an 18% market share in the wallet industry by value.
- Financial Services (Digital Lending): Strategic shift to Consumer Personal Loans (PL) with a “risk-first” approach following the wind-down of the BNPL (ZIP) product. The business is currently 80% DLG (risk-sharing) and 20% pure distribution, focusing on improving the static pool risk performance.
- Merchant Business: Expanded footprint from 366 to 1,118 cities, targeting Tier 2 and Tier 3 markets. The focus is on offline acquiring (Soundboxes, EDC) and online via the Zaakpay subsidiary, with a goal to use payment data for future merchant lending.
Company-Specific & Strategic Commentary
- Profitability Pivot: Management delivered on its H2 FY26 profitability commitment, achieving a stable operating model where costs have stabilized while margins expanded.
- Product Innovation (Pocket UPI): Utilized the wallet-on-UPI framework to differentiate from competitors, resulting in higher retention and 17 bps margins compared to the zero-revenue nature of pure bank-to-bank UPI.
- Merchant Ecosystem: Investing ₹13-15 crores per quarter in incubating merchant acquiring services; management expects these sub-segments to approach breakeven within 2-3 quarters.
- Strategic Exit: Formally exited the Buy Now Pay Later (BNPL) space due to regulatory uncertainty, replacing it with high-conviction EMI and personal loan products.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Net Payment Margin | 12 - 15 bps | Long-term sustainable range as UPI (low margin) continues to grow as a percentage of total GMV. |
| Profitability | Sustainable Growth | Management aims to maintain EBITDA/PAT positivity through revenue growth rather than further aggressive margin expansion. |
| Merchant Lending | Scale-up in FY27 | Currently in experimental phase; expected to contribute material numbers in the next financial year after data validation. |
| New Products | Mid-to-long term | Wealth management and bond products are currently experimental and not expected to provide significant short-term monetization. |
Risks & Constraints
| Risk | Context |
|---|---|
| Asset Quality | Unsecured lending remains a high-risk area; management is mitigating this through a “risk-first” approach and limit-tightening for first-time borrowers. |
| Regulatory Environment | The pivot away from BNPL was necessitated by regulatory shifts; any further changes in UPI MDR or lending norms could impact the business model. |
| Competitive Intensity | Large incumbents dominate the merchant Soundbox/EDC market; MobiKwik must find profitability in under-penetrated Tier 2/3 towns to compete. |
Q&A Highlights
Merchant Strategy
- Question: How will you compete in the merchant segment against much larger incumbents? (Sanjay Ladha)
- Answer: Focus is on Tier 2/3 cities rather than metros, and online via Zaakpay. The goal is to identify merchants scientifically for future lending rather than acquiring volume at all costs (Upasana Taku).
Lending Model
- Question: What is the split between DLG and distribution-led lending? (Sanjay Ladha)
- Answer: Currently 80% is DLG (Risk-sharing) and 20% is risk-free distribution. For loans over ₹2 lakhs, the company prefers the distribution model to avoid credit risk (Upasana Taku/Bipin Singh).
Margin Sustainability
- Question: Is the 17 bps payment margin sustainable? (Sanjay Ladha)
- Answer: While 17 bps was achieved this quarter, 13-15 bps is a more realistic long-term target as UPI volume grows (Upasana Taku).
Operating Expenses
- Question: What is the quarterly burn for new business incubation? (Vineet Gala)
- Answer: Approximately ₹13-15 crores per quarter is being invested in the merchant business, which is expected to breakeven in 2-3 quarters (Upasana Taku/Bipin Singh).
Key Takeaway
MobiKwik achieved a milestone in Q3 FY26 by delivering its first quarter of EBITDA (₹15 crores) and PAT (₹4 crores) profitability, successfully transitioning from a high-burn BNPL model to a sustainable payments-and-credit ecosystem. The company saw a 63% YoY increase in Payments GMV to ₹48,100 crores and a 126% jump in ZIP EMI disbursals, highlighting strong traction in its core products. Strategically, the firm is doubling down on “Pocket UPI” to maintain payment margins (17 bps) and expanding into Tier 2/3 merchant acquiring to build a foundation for high-margin merchant lending in FY27. While net payment margins are expected to normalize to 12-15 bps, the stabilizing credit costs and 57% YoY reduction in lending-related expenses suggest a more resilient bottom line. Management remains focused on high-quality growth and remains cautious on unsecured credit risk as they target consistent profitability in the quarters ahead.
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