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Informist, Thursday, Dec. 4, 2025

 

--One Mobikwik Systems CFO: Expect to turn EBITDA positive in Q3

--One Mobikwik Systems CFO: Co likely to turn PAT positive in Q3 or Q4

--One Mobikwik Systems CFO:Building new products but profitability first aim

--One Mobikwik Systems CFO:Yet to recover from one-time cost reported for Q2

By Shakshi Jain

 

NEW DELHI – One Mobikwik Systems Ltd. expects to report a profit in earnings before interest, tax, depreciation, and amortisation for the ongoing quarter, co-founder and Chief Financial Officer Upasana Taku told Informist in an exclusive interaction last week. On profit after tax, Taku said she wasn't "sure yet." One Mobikwik Systems is likely to turn profitable on a net basis in the March quarter if not in the ongoing quarter, Taku said.

 

This will be after five consecutive quarters of reporting consolidated losses on a net basis since One Mobikwik Systems listed on stock exchanges in December 2024. In terms of EBITDA, the company has been in the red since the December quarter. For the September quarter, One Mobikwik Systems reported a net loss of INR 286.15 million on EBIDTA of INR (-)63.76 million.

 

"We had six quarters of profitability before going for a listing...last year this time, there was a dip in the unsecured lending sentiment in the market because of which all the banks and NBFCs (non-banking financial companies) reduced their lending and because we are also a distributor of loans, so our lending revenues came down, which is why we are in loss," Taku told Informist on the sidelines of an event in Mumbai last month.

 

Since the September quarter of 2024-25 (Apr-Mar), One Mobikwik Systems' total income mix has changed in favour of the payments segment, which contributes lower margins compared to the financial services segment. In the latest September quarter, the financial services business contributed around 22% to the company's total income, down from 35% in the corresponding quarter last year and 26.6% in the December quarter of the last financial year.

 

One Mobikwik Systems is a digital wallet company that offers a wide range of payments and financial products to both consumers and merchants.

 

Since the June quarter, the company has discontinued its ZIP service, a buy now, pay later product, which contributed nearly 54% to the company's total digital credit disbursals in FY25. "Zip is paused due to low lender appetite," One Mobikwik Systems had said in a presentation to investors, adding that the company's focus was solely on longer-tenure ZIP EMI.

 

MobiKwik ZIP is a short-term, interest-free credit line for daily purchases, while ZIP EMI is an instant personal loan product for higher amounts with longer, interest-bearing repayment tenures. 

 

"Now that we're at 34% (34.4% contribution margin in Jul-Sept FY26), we're at a baseline level. Once we hit, you know, late 30s, you know we'll break-even again because...our fixed cost is 36% (36.7% of total income in Jul-Sept FY26)," Taku said.

 

One Mobikwik Systems calculates the contribution margin as total income minus direct cost such as payment gateway expenses, user incentives, and cost of funds.

 

The company has also launched several new products in recent quarters such as the instant forex payment service on its mobile app. "We keep doing many new things...but these are things that will give us growth in the next year. Currently, we're building them in a calibrated manner because our first goal is to turn profitable," Taku said.

 

Typically, the December quarter is a seasonally strong quarter for One Mobikwik Systems due higher spending on account of Diwali and Christmas, Taku said.

 

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In the September quarter, the fintech firm's consolidated net loss widened year-on-year. The loss widened due to a fraud by some registered merchants and users amounting to INR 403.59 million. In the absence of the exceptional cost of INR 118.3 million that One Mobikwik Systems reported for the September quarter, the company's net loss would have narrowed to INR 167.49 million.

 

In early September, some registered merchants and users, primarily located in Nuh and Mewat regions of Haryana, colluded to exploit a technical bug in the company's application and fraudulently claimed unauthorised settlements, according to a company statement.

 

"Incident occurred on September 12 due to a technical bug from a code release on September 9. It was exploited by 2,400 merchants in Haryana. Unauthorised payouts were stopped quickly...Enhanced controls, blacklisting, and a new CRO (chief risk officer being appointed) are steps taken," the company's management said in a post-earnings conference call with analysts last month.

 

As of Oct. 31, One Mobikwik Systems had recovered INR 219.27 million, or around 54%, of the fraud amount and also secured an additional INR 66.02 million through merchant affidavits and court orders. The company is in the process of recovering the remaining INR 118.3 million, while an investigation into the technical breach of its application is underway.

 

"...we don't know how much time it will take. That is why in this quarter (Jul-Sept), we've already taken the full hit for this. And now whatever we recover it will come back as revenue to the company," Taku said. 

 

So far, One Mobikwik Systems has not recovered any fraction of the remaining INR 118.3 million, Taku told Informist. "We expect that we should be able to recover from this amount you know in the next 9-12 months because some of this will require a lot of legal action," she added.

 

In the September quarter, the company's earnings before interest, tax, depreciation, and amortisation improved almost 80% on quarter to (-) INR 63.76 million, with a 10% sequential decline in direct costs and a 5.7% drop in fixed costs.

 

For the June quarter, the company had reported a consolidated net loss of INR 419.20 million on revenue of INR 2.71 billion. The company's EBITDA in Apr-Jun was in negative territory at (-) INR 312 million, compared to INR 22 million in the year-ago June quarter.

 

The company aims to reduce its direct costs so that the contribution margin improves and control its fixed costs, while growing revenues to become profitable, Taku said.

 

At 0948 IST, shares of One Mobikwik Systems were at INR 230.76 on the National Stock Exchange, up 0.3%. The stock is down 8.6% since the company reported its results for the September quarter on Nov. 4.

 

The only research recommendation on the stock available with Informist has a 'buy' rating on One Mobikwik Systems at a target price of INR 400.  End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Avishek Dutta

 

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