Pine Labs Ltd Management Discussions

Global economy^[1]

The global economy remained resilient in CY 2025 despite rising trade tensions and geopolitical uncertainty, growing by 3.4%. Advanced economies expanded by 1.9%, led by the United States (2.1%) and Europe (1.4%), while emerging and developing economies grew 4.4%, supported by Chinas 5.0% growth and Indias 7.6% expansion, driven by strong domestic demand, resilient services and sustained public investment. Continued investments in AI, semiconductors and digital infrastructure further supported economic activity, although geopolitical developments and energy supply disruptions continued to create market volatility.

Global growth is projected to expand to 3.1% in CY 2026 before improving to 3.2% in CY 2027, while global inflation is expected to ease from 4.4% in CY 2026 to 3.7% in CY 2027. Despite nearterm uncertainties, technology- led investments are expected to remain a key growth driver. At the same time, rapid adoption of realtime payment infrastructure and embedded finance is transforming global commerce by enabling faster settlements, integrated financial services and more seamless customer experiences. ^[2] With India expected to remain one of the fastest-growing major economies, these trends are creating a favourable environment for the continued expansion of digital payments and fintech infrastructure.

Indian economy^[3]

India continued to be one of the fastest-growing major economies in FY 2025-26, with real GDP growth estimated at 7.7% as per RBI, supported by resilient consumption, improving industrial activity and sustained public investment. Inflation remained under control, with the latest Consumer Price Index (CPI) at 3.48%^[4] based on the revised 2024 base year, supporting consumer spending and business confidence, while government initiatives aimed at strengthening manufacturing, infrastructure and digital adoption continued to drive economic expansion. The countrys growing integration with global value chains and ongoing trade engagements are further enhancing its attractiveness as a destination for investment and innovation.

India is expected to remain among the fastest-growing major economies, with GDP growth projected at 6.6% in FY 2026- 27^[5], supported by continued infrastructure spending, improving private consumption and a favourable policy environment. Structural reforms, expanding digital infrastructure and increasing adoption of technology- led solutions are expected to strengthen economic activity and support growth across digital commerce, fintech and payment ecosystems, creating a conducive environment for sustained expansion in digital commerce.

Industry overview Payment ecosystem

The payments ecosystem is rapidly evolving from standalone payment solutions to integrated commerce platforms. Driven by real-time payments, embedded finance and digital commerce, businesses are increasingly adopting unified platforms that combine payment acceptance, financial services and merchant solutions. This shift is creating significant opportunities for technology-led payment infrastructure providers.

India: Leading the global real-time payments revolution⁶

India has emerged as the worlds leading real-time payments market, driven by its Digital Public Infrastructure (DPI), widespread UPI adoption and strong regulatory support. The countrys interoperable payments ecosystem has transformed digital commerce, enabling instant, secure and low-cost bank-to-bank transactions at an unprecedented scale. Today, India accounts for nearly 49% of global real-time payment transaction volume, making it the worlds largest real-time payments ecosystem.

Indias payment stack goes global

Indias digital payment infrastructure is increasingly being adopted beyond its borders through UPI-enabled cross-border payment linkages. UPI is now operational across Singapore, UAE, France, Bhutan, Nepal, Sri Lanka, Mauritius and Qatar, supporting seamless cross-border transactions and demonstrating the global scalability of Indias payment stack.

India opportunity

Indias payments ecosystem continues to present a significant growth opportunity, with total payment value (TPV) projected to reach approximately g256-276 Trillion by FY 2028-29. Growth is being driven by increasing adoption of digital payments, UPI, cards and affordability solutions, supported by expanding merchant acceptance and evolving embedded payment experiences.

International opportunity

Key international markets including Southeast Asia, UAE, Australia and the US continue to offer strong growth potential across payments and affordability solutions. The total ; market opportunity is projected to reach approximately USD 3,117-3,154 \

Billion by 2028, driven by increasing digital payment adoption, I expanding affordability solutions I and the evolution of integrated payment ecosystems.

Payments and Commerce needs are complex, Pine Labs full stack platform simplifies commerce

Industry transformation

Historically (Fragmented payments)

Fragmented payment infrastructure across merchants, banks and service providers

Predominantly cash-driven transactions with limited acceptance infrastructure

Standalone payment acceptance solutions

Revenue models centred primarily on transaction processing

Hardware-led payment acceptance

User-driven transaction journeys

Today (Integrated)

Integrated, interoperable payment ecosystems connecting multiple stakeholders

Widespread adoption of UPI, QR codes, cards and digital wallets

Embedded affordability solutions and digital lending capabilities

Value-added/flow services services including analytics, loyalty, reconciliation and customer engagement

Cloud-enabled, API-driven and platform-based commerce infrastructure

AI-enabled and agent-assisted commerce supporting discovery, decision-making and transaction execution

Over the past decade, Indias payments ecosystem has evolved from a fragmented, transaction-centric environment to an integrated digital commerce ecosystem. Advances in payment infrastructure, regulatory support a nd merchant digitisation ha ve expanded the role of payment service providers beyond transaction processing to encompass software, affordability, analytics and embedded financial services. As businesses increasingly adopt omnichannel and platform-led models, the industry is moving towards more connected, intelligent and scalable commerce solutions.

The P2M payments ecosystem is driven by increasing adoption of UPI, cards and digital payment solutions across in-store and online channels. Expanding payment acceptance infrastructure and rising consumer preference for cashless transactions are expected to support continued growth in transaction volumes and values.

In-store digital payments in India

Indias in-store payments market is witnessing strong growth, driven by increasing merchant digitisation and adoption of Digital Checkout Points (DCPs). The installed DCP base is projected to reach 20-21 Million by FY 2028-29, supported by growing demand for integrated payment and value-added solutions.

Source(s): RBI, Redseer Research and

Analysis-Powering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

Source(s): RBI, Redseer Research and

Analysis-Powering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

Source(s): RBI, Redseer Research and

Analysis-Powering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

Indias online payments market is projected to reach S123-134 Trillion by FY 2028-29, supported by continued growth in e-commerce, digital services and omnichannel commerce. Pine Labs is expanding its presence through tailored solutions for quick commerce, D2C brands, government and SMB merchants.

Merchant segments in India

Indias merchant ecosystem comprises 80-85 Million merchants, as of FY 2024-25, with digital adoption increasing across segments. Small and micro merchants continue to adopt

QR-based payment solutions and soundboxes, while mid-market and large merchants are increasingly moving towards integrated Digital Checkout Points (DCPs) that support payments, billing, affordability solutions, analytics and customer engagement.

The adoption of DCPs is expected to grow the fastest, with the merchant base projected to increase from ~9-10 Million in FY 2024-25 to ~19-20 Million by FY 2028-29, driven by rising demand for integrated and technology-enabled commerce solutions.

Digital payments - Key International markets

• Southeast Asia (SEA): Digital payments continue to grow rapidly, supported by rising merchant digitisation, e-wallet adoption and expanding real-time payment infrastructure.

• United Arab Emirates (UAE): A mature and fast-growing market, driven by high digital penetration, increasing wallet adoption and a strong retail ecosystem.

Fintech infrastructure in India

Indias fintech infrastructure ecosystem is expanding rapidly, supported by increasing adoption of embedded finance, API-led services and interconnected financial systems. As payments, lending, identity verification and data-sharing become more integrated, fintech infrastructure providers are enabling scalable and seamless financial services across the ecosystem.

Indias digital public infrastructure

Component	Function	Impact
Bharat Connect (BBPS)	Unified bill payments platform	Digitises cash-heavy ecosystem
UPI Switch	Real-time payment routing infrastructure	Powers scalable instant payments
Account Aggregator (AA)	Consent-based financial data sharing	Enables faster lending and underwriting
Identity Stack (Aadhaar, Digilocker)	Digital KYC and verification	Reduces onboarding friction

Affordability solutions

Indias affordability solutions market continues to expand rapidly, supported by increasing credit penetration, rising adoption of digital lending platforms and growing consumer preference for flexible payment options. Retail consumption loans are projected to reach ~g95-120 Trillion by FY 2028-29, creating significant opportunities across both instore and online channels. EMI and deferred payment solutions are gaining traction across key consumption categories, while Pine Labs has built one of Indias largest affordability ecosystems with 450+ brands, 40+ credit institutions and 80k+ transacting stores. Indias affordability solutions TPV is expected to grow to 56.6 -7.2 Trillion, with DCP base affordability solutions projected to be 51.7-1.9 Trillion by FY 2028-29 growing at the CAGR of 33-36%.

Indian affordability solutions TPV - Split by methods

Source(s): Redseer Research and Analysis-Powering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

Affordability solutions - Key International markets

• Southeast Asia (SEA): The affordability solutions market is projected to reach ~USD 94-102 Billion by 2028, driven by growing demand for flexible financing solutions.

Source(s): Redseer Research and Analysis-Powering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

• United Arab Emirates (UAE): The market is projected to reach ~USD 5.8-6.3 Billion by 2028, supported by increasing adoption of instalment- based payment solutions.

Source(s): Redseer Research and Analysis-Powering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

Prepaid cards opportunity

Prepaid cards are emerging as a scalable payment instrument in India across open-loop, semi-closed- loop and closed-loop formats, supporting use cases such as corporate expenses, gifting, travel loyalty management, compensation, cashbacks, meals, rewards and refunds. Despite strong growth in recent years, the segment remains underpenetrated, with Indias closed and SCLP cards TPV projected to grow to USD 146 Billion by CY 2028 .

India closed and SCLP cards TPV

Source(s): Redseer Research and AnalysisPowering Indias Digital Transaction. Economy: The Evolution of Digital Payments and Issuing dated 16 October, 2025

The prepaid cards segment is witnessing continued innovation through virtual cards and expanding use cases across mobility, retail, gaming, healthcare, foreign exchange (forex) and the gig economy. Gift cards remain a significant sub-segment, supported by corporate incentives, refunds and promotional campaigns. With increasing digitisation and wider adoption, prepaid cards are expected to play a growing role in Indias digital payments ecosystem.

Issuing - Key International markets

• Southeast Asia (SEA): Prepaid card transaction value is projected to reach ~USD 86 Billion by 2028, supported by growing card adoption and e-commerce expansion.

Source(s): Redseer Research and Analysis

• United Arab Emirates (UAE):

Prepaid card transaction value is projected to reach ~USD

13.8 Billion by 2028, driven by rising card usage and digital payment adoption.

Source(s): Redseer Research and Analysis

Agentic commerce^[8]

Agentic commerce refers to a model in which Artificial Intelligence (ai) agents autonomously discover, evaluate and execute transactions on behalf of users, enabling a seamless and proactive commerce experience.

Agentic commerce is emerging as a transformative trend in digital commerce, with the global B2C retail market expected to generate USD 3-5 Trillion in revenue through Al-driven commerce models by 2030. Rapid advancements in AI capabilities and the ability of AI agents to operate on existing digital infrastructure are accelerating adoption. As AI systems become capable of managing increasingly complex transaction workflows, agentic commerce is expected to shift the ecosystem from user- driven interactions to AI-mediated transactions, reshaping demand generation, decision-making and transaction execution across the commerce value chain.

Company overview

Pine Labs is the commerce operating system for the Global South and a technology company focused on digitising commerce through digital payments and issuing solutions for merchants, consumer brands, enterprises and financial institutions. In practice, its platform enables a retailer to accept any form of payment, offer an on-the-spot EMI solution, issue a branded gift card and reconcile everything in one place. It enables a bank/fintech to launch a full credit card programme without building core processing infrastructure and deploy and manage payment, affordability, issuing and commerce solutions for its clients. It helps an enterprise run its channel incentives, employee rewards and consumer promotions from a single platform. The Company connects merchants, consumer brands, enterprises and financial institutions through a unified commerce platform. It helps businesses accept payments, issue prepaid and credit products, offer affordability solutions and manage customer engagement from a single platform. Pine Labs operates across 22+ markets spanning India, Southeast Asia, the Middle East, the US and Africa, delivering integrated commerce infrastructure rather than standalone products. Today, over 11 Lakhs merchants, 750+ consumer brands and enterprises and 200+ Financial institutions operate on its platform, processing approximately S17.2 Lakhs Crores in gross transaction value and more than 2 Crores transactions every day.

The Companys platform comprises four layers, including transaction infrastructure powering omnichannel payment acceptance; a value-added services layer running one of Indias leading point-of-sale affordability marketplace; an issuing and acquiring platform enabling brands and banks to issue, accept, store and move value at scale; and a data intelligence layer converting transaction data into merchant insight and Al-native services. In FY 2025-26, this compounding model delivered Revenue from Operations of ^2,711 Crores, Adjusted EBITDA of S559 Crores, PAT of S113 Crores and Operating Cash Flow of S395 Crores, a financial profile that reflects both the scale of its infrastructure and the improving margin mix as the Company move up the stack. The Companys strategy is anchored across three dimensions: a multiproduct platform spanning the full commerce stack, a multi-segment reach from large enterprises to the growing mid market and a multi market footprint that exports Indias battle-tested fintech infrastructure to emerging and developed markets alike.

The Companys business model

The Company generates revenue from two platforms serving merchants, brands, enterprises and financial institutions-

The Companys Digital Infrastructure and Transaction Platform spans three offerings-

(i) In-store and online infrastructure — payment solutions covering multiple payment methods, software, billing integrations, settlements, automated reconciliation, merchant dashboards, on-site servicing and omnichannel capabilities including payment aggregation, tokenisation and payouts.

(ii) Flow, Affordability and Transaction Processing — an affordability ecosystem linking merchants, brands and credit issuers at checkout with real-time approvals and fraud checks; an offers platform; trade-ins; and flow-based services such as dynamic currency conversion, UPI, wallets, pay by points, loyalty and payment aggregation services.

(iii) FinTech infrastructure — an API-enabled platform that enables financial institutions to accept UPI payments in their own apps, enables fast onboarding via eKYC and online contracts and integrates with providers for payments, bill pay and other services.

The Issuing and Acquiring Platform enables merchants and brands to create prepaid products that drive sales by helping them acquire, retain, engage with and grow their customer base and provides financial institutions with technology to issue credit, debit, forex and prepaid instruments and offer merchant acquiring services.

• The Company processed nearly USD 194 Billion in GTV, growing 50%+ YoY (with UPI GTV growing 68% YoY), enabling 2 Crore+ Avg. daily transactions transactions across its platform.

• The Companys merchant network continues to scale rapidly. It expanded its installed DCP base to 20 Lakhs+ touchpoints and recently won a major mandate from Indias top 3 petroleum companies. Across segments, from F&B, lifestyle, D2C, electronics, automobiles and hypermarkets to education, Pine Labs continues to add leading mid-market and SMB merchants to its platform.

• The Companys continued expansion of its leading affordability network, connecting 450+ brands, 40+ credit issuers and 80k+ transacting stores, with growth accelerating from new brand signups, especially in non-electronics across automobiles, furniture, fashion, healthcare and beauty and wellness. ^•

• The Companys enterprise prepaid business also delivered strong momentum, processing g64,000 Crores+ in GTV during FY 202526. It expanded into new categories, launched co-branded MSME programmes with partners and strengthened its distribution footprint.

Financial summary

Particulars	FY 2025-26 (t Cr)	FY 2024-25 (t Cr)	YoY Change
Revenue from Operations	2,711	2,274	19%
Direct Expenses	669	545	23%
Contribution Margin	2,041	1,729	18%
Contribution Margin %	75%	76%	(1%)
Indirect Expenses*	1,482	1,372	8%
Adjusted EBITDA	559	357	57%
Adjusted EBITDA Margin %	21%	16%	5%
Depreciation, ESOP and Others	422	493	-14%
Profit / (Loss) before Tax	137	(136)	+274 Cr
Profit / (Loss) for the Year	113	(145)	+258 Cr

Overview of performance

FY 2025-26 marked a defining year in Pine Labs journey, demonstrating the strength of its platform-led growth model. Over the last three years, Pine Labs scaled platform GTV at a CAGR of 57%. During FY 2025-26, on average, Pine Labs processed more than 2 Crores transactions daily and expanded its DCP base to 20 Lakhs+ touchpoints, translating into sustained revenue growth while improving operating efficiency.

Over the last three years, Pine Labs revenue expanded at a CAGR of 19%, while international revenue grew at a CAGR of 44% during the same period. Pine Labs is witnessing a shift in its revenue mix from more distribution-led revenue to a higher mix from consumer, brand and payment value pools. The mix of revenue from consumer brands and payment value pools has increased from 58% in FY 2022-23 to 66% in FY 2025-26, along with an expansion in the revenue mix of business services and data value pools.

A favourable shift in revenue mix, combined with operating leverage from higher business scale, supported a significant improvement in profitability, with Adjusted EBITDA margin increasing from 9% in FY 2023-24 to 21% in FY 2025-26.

Pine Labs reported a Profit After Tax of gll3 Crores in FY 2025-26, reversing from of S145 Crores in FY 2024-25, while operating cash flow improved by 8x to over S395 Crores during the same period. These milestones reflect the successful conversion of scale into profitability and cash generation, creating a stronger foundation for long-term growth.

Revenue from digital infrastructure and transaction platform

DITP Revenue grew 15% YoY to ^1,837 Crores, driven by higher platform GTV, increased digital checkout points and deeper monetisation

*Indirect expenses include employee benefits expense (excluding ESOP),other expenses (excluding fair valuation loss and legal and professional expense relating to acquisition and restructuring), impairment losses on financial assets & contract assets and bad debts, net off liabilities and provisions no longer required written back (excluding liability written back on settlement of purchase consideration payable). of flow-based services such as affordability, analytics, DCC, growth partnerships and payment processing. Growth was supported by strong adoption across enterprise merchants and expansion into new online categories, along with higher activation of Flow-based services across the existing merchant base.

• In-store and online infrastructure: In-store

revenue comes mainly from subscription fees for Digital Checkout Points (DCP) usage and other related services. Average monthly revenue was ~5350 per DCP in FY 2025-26. Online payments revenue is based on a fee for transaction value processed.

• Flow, Affordability and

Transaction processing:

Fees are largely linked to GTV processed, averaging ~33 bps in FY 2025-26 on blended basis. Pine Labs earns fees from merchants, consumer brands and financial institutions offering affordability solutions and a host of flow-based services and transaction processing services such as dynamic currency conversion, UPI, wallets, pay by points and payment aggregation services.

• FinTech infrastructure:

Transaction-linked fees based on volume of transactions processed on the Companys platform, averaging 50.6 per transaction in FY 2025-26.

These are the Companys key offerings; other incidental services are not significant and services may be delivered in a combined or integrated form across the three categories-.

Revenue from issuing and acquiring platform

The Companys full-stack platform enables online and offline merchants, brands and enterprises to issue, process, distribute and manage prepaid instruments for use cases such as gifting, promotions, cashback, returns, rewards and incentives. The Company also provides technology infrastructure to financial institutions for issuing credit, debit, forex and prepaid instruments and for merchant acquiring services.

The Company earns fees based on GTV processed or distributed through Pine Labs platform, averaging ~135 basis points for FY 2025-26.

Performance

Revenue increased 30% YoY to 5874 Crores, with GTV growing ~25% YoY to 564,000 Crores, driven by strong growth in prepaid, gift cards and embedded payment solutions across India and international markets. Growth was supported by expansion in distribution- led programmes, onboarding of new brands and increased usage of prepaid instruments across corporate, retail and mobility use cases.

Direct expenses

Direct expenses in FY 2025-26 were 5669 Crores, an increase of 5124 Crores (23%) YoY from 5545 Crores in FY 2024-25, with the majority of the increase driven by higher distribution costs:

• Distribution cost for Prepaid Cards grew by 594 Crores (35%) YoY to 5364 Crores in FY 2025-26 from 5270 Crores in FY 2024-25. This reflects our deliberate investment in expanding our distribution prowess to deliver a holistic value proposition for brands in acquiring, retaining and growing their customers. We are approaching each market with a full-stack strategy: we acquire marquee processing brands in global markets, then expand into distribution to deepen relationships and build stickiness. This playbook has worked well in India, and we are now executing it globally.

• Connectivity and operational costs reduced to 5130 Crores in FY 2025-26 from 5141 Crores in FY 2024-25, with disciplined cost optimisation which more than offset any increase from a growing POS base and our international scale-up. Beyond efficiency, we are enabling AI-driven capabilities on our devices and expanding use cases, creating the opportunity to earn incrementally from flow and transactions, not just from subscriptions. COGS of DCPs increased modestly to 5176 Crores from 5136 Crores, in line with upfront sale volumes.

Direct expenses as a percentage of revenue remained largely stable, with contribution margin of ~75%, reflecting the Companys continued discipline on unit economics even as it scales.

Segment-wise, Digital

Infrastructure and Transaction Platform (DITP) contribution margins remained strong at ~83%, while Issuing and Acquiring Platform (IAP) contribution margins held at ~58%, driven by a mix shift towards higher distribution.

Indirect Expenses

Indirect expenses 51,482 Crores grew at a much slower pace than revenue - an increase of 5110 Crores (8%) - reflecting strong operating leverage across all key cost categories:

• Employee expenses

(excluding ESOP) grew only ~5% YoY to 5917 Crores despite a 19% YoY revenue growth, with headcount increasing 15% YoY. Employee cost as a percentage of revenue declined from 38% in FY 2024-25 to 34% in FY 202526, a 400 bps improvement. We have strategically added ~500 salespeople YoY, consciously deploying incremental headcount in three high-growth vectors: our mid-market segment, international business development teams across SEA and other newer geographies, and Products Capability & Innovation. This disciplined allocation ensures every incremental hire is directed toward compounding growth.

• Data, cloud and Tech expenses

increased 9% YoY to 5207 Crores, in line with Pine Labs scale. This reflects deliberate futurefacing investments, each of which builds durable capability and unlocks compounding efficiency over time.

• Legal, Audit and Third-Party consultancy grew ~15% YoY to 5130 Crores, remaining stable at ~5% of revenue. The increase reflects higher consultants cost across newer geographies and businesses, continued investments in our Information Security and legal capabilities, and higher post-listing costs such as audit and related professional fees.

• Other indirect expenses grew ~14% YoY to 5229 Crores, driven by higher corporate marketing and branding spend, alongside BAU expenses that scale naturally with the size and complexity of the business.

The combined effect of these levers translated into a 500 bps expansion in Adjusted EBITDA margin from 16% in FY 2024-25 to 21% in FY 202526, with Adjusted EBITDA growing 57% YoY to 5559 Crores against revenue growth of 19%.

Depreciation, ESOP and Others

Depreciation, ESOP and Others reduced to 5422 Crores in FY 202526 from 5493 Crores in FY 2024-25, a decline of 571 Crores (14%) YoY, with the majority of the reduction driven by lower depreciation and amortisation. Depreciation on DCPs reduced to 5128 Crores from 5140 Crores, and other depreciation and amortisation reduced to 5147 Crores from 5197 Crores, together reflecting a structural shift in our operating model toward capex- light, software-led deployments, increased use of refurbished devices, and lower amortisation of acquisition-related intangibles. This shift is important because it meaningfully improves our unit economics and creates room to reinvest in growth without proportionate capital intensity.

ESOP costs remained contained relative to the scale of new grant issuances, as legacy grants completed their vesting tenure, while finance costs were broadly stable at 584 Crores.

Profitability

Pine Labs delivered Profit After Tax of 5113 Crores in FY 202526, representing a 5258 Crores swing from a loss of 5145 Crores in FY 2024-25.

Operating cash flow and working capital

Operating cash flow improved significantly in FY 2025-26, with operating cash at 5395 Crores compared to 550 Crores in FY 202425. Adjusted operating cash flow (excluding early settlement) was 5554 Crores in FY 2025-26 versus 5250 Crores in FY 202425, more than doubling YoY. The quarter-on-quarter movements in operating cash flow are primarily driven by seasonality (festive demand in Q3) and movements in early settlement to merchants. On a steady-state basis, working capital as a percentage of revenue is expected to remain in the 13-15% range.

International business

International revenue performance

Internationally, FY 2025-26 was another breakthrough year. The Companys business crossed 5400 Crores in revenue, contributing nearly 15% of overall revenue. The Companys revenue from international business has been compounding at a CAGR of 44% for the last three years.

The Company signed marquee customers in UAE, Philippines and SEA, expanded into acquiring services in Singapore, launched prepaid programmes for International clients. Toda y, it powers prepaid solutions for 20+ airlines globally.

International Revenue

Pine Labs is now operating across 22+ countries, with its international business demonstrating strong, broad-based momentum.

Pine Labs continues to win new logos across geographies and approaches each market with intent, calibrating investment to market maturity. Pine Labs leads with a product-based approach following its "Seed, Land, Expand and Deepen" framework:

a) Seed - prepaid solutions, including gift cards, to establish market presence;

b) Expand - technology processing partnerships for a wider country footprint; and

c) Deepen - direct merchant acquisition and DCP deployment in mature markets.

Opportunities and threats Platform-led expansion

The Company is transitioning from a product-led to an integrated platform-led model, as a full-stack commerce and fintech partner rather than a point-solution provider. This shift is expected to expand wallet share through multi-product bundling across merchants, brands and financial institutions, while unlocking cross-business synergies that strengthen the Companys enterprise proposition.

International scale-up

Building on the Companys India foundation, the Company is scaling globally through a multi-market engine anchored in Southeast Asia, with expansion into the US, and the UAE. The Company is prioritising high-growth corridors, airlines,

SMBs in SEA and market entry in the US, by replicating the India playbook through a platform- led go-to-market approach and strong local partnerships.

Distribution and merchant scale

The Company is expanding its merchant footprint beyond its established enterprise franchise into the growing mid-market and SMB segments. The scaling of Woohoo 2.0 and reseller networks under IAP business and selfserve, affiliate and partner-led acquisition channels across instore and online payments is expected to support continued merchant and transaction growth.

Affordability expansion

The Company continues to expand its affordability ecosystem beyond consumer electronics into categories including furniture, fashion, healthcare, automobiles, wheels and other emerging consumption segments. Growth is expected to be supported by new brand s, UPI- led affordability, an expanding store network and greater adoption. The Company also expects to expand its addressable market across the full customer journey, from pre-transaction demand creation through in-transaction affordability to post-transaction engagement and monetisation.

Embedding prepaid across use cases

The Companys prepaid issuance franchise offers a long growth runway through deeper adoption of existing use cases, expansion into new brands and categories and international growth. New opportunities include gaming, employee benefits and international markets expansion, alongside the expansion of prepaid programmes across airlines and other emerging use cases.

Agentic commerce and AI-led payments

AI agents are enabling autonomous discovery, decisionmaking and payments, creating an emerging opportunity for Pine Labs to power secure, agent-led commerce and payments across merchants and consumers.

Threats

While the industry continues to expand, certain structural challenges persist. Evolving regulatory requirements and coordination across a broad ecosystem of partners, including brands, financial institutions and merchants, require continued execution. The shift toward agentic workflows also introduces new questions around the identity and authentication of transacting agents, requiring the Company to evolve its platform and risk frameworks accordingly. At the same time, rising transaction volumes call for continued investment in cybersecurity and platform resilience, while the pace of technological change demands ongoing innovation.

Key financial ratios

Ratio	FY 2025-26	FY 2024-25
Debtors Turnover (in times)	2.47	2.31
Inventory Turnover (in times)	13.41	11.08
Interest Coverage Ratio (in times)	2.67	(0.26)
Current Ratio (in times)	1.52	1.19
Debt Equity Ratio	0.07	0.28
Operating Profit Margin (%)	8.3%	(0.9)%
Net Profit Margin (%)	4.2%	(6.4)%
Return on Net worth(in %)	1.9%	(4.1)%

Risk management

Risk	Description	Mitigation Strategy
Strategic risk	It is the risk to earnings and capital arising from a lack of responsiveness to changes in the business environment, adverse business decisions or the adoption of inappropriate strategies and choices.	Management adopts a proactive approach to changes in the economic and business environment. Business strategies are regularly reviewed with senior officials of the organisation to enable timely strategic decision-making. Significant strategic matters are also referred to the Board, whose members bring diverse experience across their respective fields, for detailed deliberation and informed decision-making.
Operational risk	Operational risk is defined as the risk of loss resulting from inadequate or failed internal processes, people or systems or from external events. It also includes fraud risk, information security and cybersecurity risk, technology risk, product risk, business resilience risk and legal risk.	• Review of operational loss incidents, along with detailed Root Cause Analysis (RCA), is undertaken by the concerned department and where required, by cross-functional teams to identify corrective and preventive actions. The Risk and Compliance team review the incident and RCA, following which the incident is reported to the ERMC. The corrective actions and implementation timelines are tracked by the ERMC.
		• Fraud Risk management policy is in place and effectively implemented.
		• The Companys policies are documented and approved by the Board.
		• The Company strives to promote an appropriate risk culture in which employees are aware of operational risks and are encouraged to learn from their mistakes.
Compliance risk	Pine Labs India, as a fintech company, falls under the regulatory purview of the Reserve Bank of India (RBI), NPCI, FIU, Card Networks, SEBI and the Ministry of Corporate Affairs. In addition, the Company is required to comply with various central, state and commercial laws applicable to the conduct of its business activities. Any non-compliance with mandatory regulatory requirements may result in compliance risk and expose the Company to penalties imposed by regulatory or statutory authorities.	The Company recognises that the regulatory landscape is subject to periodic change and therefore remains proactive in preparing for evolving regulatory requirements. The Company responds effectively to regulatory changes, maintains constructive relationships with regulators and authorities, strengthens its capital position and enhances the quality of its in-house compliance framework. All regulatory reports, returns and disclosures are submitted accurately and in a timely manner to reflect the correct position.
Human resource/ Talent risk	The Pine Labs growth story depends on attracting and retaining critical leadership talent to create and sustain an enduring competitive advantage.	• Designing long-term incentive structures, including equity-linked compensation, with sustained value creation to attract and retain key leadership talent
	As Pine Labs expands into new domains and regulated jurisdictions, a strong focus on governance and compliance is a must.	• Investing in structured capability building and targeted hiring within the risk and compliance functions to ensure the organisational skill base keeps pace with its rapidly expanding regulatory footprint.
Vendor/ Outsourcing risk	Vendor risk arises from the use of service providers and suppliers and may result in business disruption, misuse of data or an adverse impact on business performance.	• The Company has adopted the Reserve Bank of India (RBI) Outsourcing Guidelines. Accordingly, no core management function of the Company is outsourced.
		• Board-approved Outsourcing Policy, Sourcing Policy and Information Security Policy are in place and are effectively implemented.
		• Vendor onboarding includes an assessment of each vendor based on its inherent risk.
		• The Company conducts periodic performance evaluations of critical vendors. • Outsourcing agreements are carefully drafted in accordance with the terms prescribed in the RBI Outsourcing Guidelines.
Reputation risk	Reputation risk arises from an adverse perception of the Companys image among customers, counterparties, shareholders, investors and regulators. It refers to the potential adverse effects resulting from damage to the Companys reputation due to factors such as unethical practices, regulatory actions, customer dissatisfaction and complaints that lead to negative publicity.	• Grievance Redressal Mechanism (GRM): The Company has a defined GRM in place and it is available on Pine Labs website.
		• Regular tracking of media mentions: The Company tracks and monitors media and social media mentions relating to the Company and engages with the media, where appropriate.
		• Legal obligations: All employees, vendors and associates are required to sign agreements containing non-disclosure provisions to safeguard the Company against reputational risk.
	Operating in a regulated and socially sensitive industry may significantly affect the Companys reputation and brand equity as perceived by regulators, including the Reserve Bank of India (RBI), central, state and local authorities, the banking industry and customers.
Financial risk	Financial risk refers to any event or circumstance that may result in financial loss in terms of revenue or profit after tax (PAT) and may require additional capital deployment. The Company may also be exposed to risks arising from inaccurate financial reporting due to inadequate internal controls and governance mechanisms. In addition, liquidity risk may arise from a lack of readily accessible funds or the inability to convert assets into cash without a significant loss in value, which could adversely affect the Companys operational and financial flexibility.	The Company has established a robust risk management and internal control framework to identify, assess and mitigate financial risks on a continuous basis. The Company prepares an Annual Operating Plan (AOP), which is regularly monitored against actual performance throughout the year to enable timely corrective action and maintain financial discipline. Appropriate controls over financial reporting, including segregation of duties, regular reconciliations and process automation, are implemented to ensure the accuracy and reliability of financial information. The Company also has a strong treasury function to manage cash flows effectively and maintains access to external funding sources to support its liquidity and capital requirements.

Human resources

Pine Labs is building globally scalable platforms across merchant payments, embedded credit, crossborder rails and the emerging class of agentic payments, positioning the organisation at the forefront of how payments will work in the future. As payment infrastructure and AI capability evolve rapidly, the durability of Pine Labs growth story depends on the organisations capability to keep bringing new products ahead of the market, delivering reliably at scale and structuring around what the market demands next. Pine Labs people strategy exists to build that innovation capability, creating and defending category leadership, reducing execution risk and demonstrating the governance maturity investors expect of a company scaling at this pace.

At Pine Labs, expertise spanning technology, payments, banking, regulation and customer experience has become one of the Companys enduring competitive advantages and it has been built deliberately, not by accident.

Through acquisitions and the integration of diverse teams, Pine Labs has assembled specialists across payments acceptance, merchant platforms, embedded finance, issuing and AI-enabled commerce. Each domain adds to a shared institutional base, so expertise continually builds upon itself rather than resetting with every new market or product line. As at 31^st March, 2026 the permanent employees of the Company were 5007, with 4797 employees based in India and 210 employees based in international geographies.

Outlook

FY 2025-26 marked Pine Labs transition from a product-led organisation to an integrated, platform-led commerce and fintech partner, serving merchants, brands and financial institutions across 22+ markets.

As commerce becomes increasingly agentic, the advantage shifts to scaled platforms with deep ecosystem integration and diversified revenue streams, positioning Pine Labs as the connective tissue between consumers, merchants, brands and financial institutions.

The Company expects the business to grow robustly over next few years driven by multiple growth vectors across the business segments.

In-store and Online Payments: The Company has a established position in the enterprise segment and is expanding into the mid market through a focused strategy. Organic growth among enterprise merchants and their increasingly complex commerce needs, together with new merchant cohorts in the mid-market will drive expansion. Deeper integrations, broader form factors, master-franchise growth will provide further momentum. International expansion across Southeast Asia and the UAE supported by marquee contract wins , will further accelerate growth.

Online payments growth will be driven by the Companys enterprise franchise and expansion into the government, education, midmarket and SMB segments. Shopflo will deepen checkout solutions across D2C brands, supported by affordability, conversion and merchant intelligence capabilities, along with emerging cross-border and agent-led commerce flows.

Flow, Affordability and Transaction Processing: Growth will be driven by premiumisation, expansion into new categories beyond electronics and deeper penetration across the Companys network. This will be supported by new brands entering the affordability segment, the rise of emerging smartphone brands, UPI-led affordability expanding the customer base, an expanding store network, greater bank focus on EMI and the emergence of new-age issuers.

The Company expects to expand its addressable market across the full customer journey, from pretransaction demand creation to post-transaction engagement and monetisation, building on its core in-transaction strength.

Growth in the Companys flow and transaction-based services will be driven by new avenues for monetising its GTV, expansion into bespoke solutions and specialised vertical solutions, including the execution of contracts secured from OMCs in FY 2025-26.

Issuing and Acquiring Platform: Growth will be driven by deeper adoption of existing use cases, expansion into new brands, categories and bespoke solutions and entry into new geographies through international expansion. The Companys prepaid issuance franchise offers a long growth runway, with airline partners expected to increase from 20 currently to more than 50 through Amadeus. The Company also sees significant opportunities in new use cases and categories such as gaming and employee benefits, supported by structural tailwinds including a large and growing base of formally employed individuals, an expanding gaming population and the expansion into international gift card markets.

These businesses create a cycle: distribution makes payments stickier, while payments enable affordability, insights and brand monetisation. With sustained momentum in volumes, profitability and international expansion, the Company remains committed to becoming the leading fintech for the Global South by building the commerce operating system through innovation, sustainable growth and margin expansion.

Key areas of focus

• Scaling high-growth segments

such as affordability solutions, prepaid solutions, agentic payments and mid marke.

• Deepening merchant engagement through platform-led monetisation and tailored flow services.

• Investing in next-generation capabilities, including AI-driven commerce and automation, to enhance product innovation, fraud prevention and operational efficiency.

• Expanding the international footprint through a structured approach to seeding, scaling and localising operations in new markets.

Internal control systems and their adequacy

Pine Labs has established a robust internal control framework commensurate with the size, scale and complexity of its operations. The Companys internal control framework is designed to ensure orderly and efficient conduct of business, safeguarding of assets, prevention and detection of frauds and errors, accuracy and completeness of accounting records and timely preparation of reliable financial information , with a strong emphasis on technology systems, data security and transaction integrity.

The control environment is reinforced by well-defined policies, periodic reviews and ongoing internal audits, encompassing assessments of IT systems and operational processes. The Audit Committee actively oversees internal audit findings and financial reporting and monitors the implementation of audit recommendations. Based on periodic evaluations, the management believes that the internal control systems are adequate and operating effectively.

Cautionary statement

The Management Discussion and Analysis (MDA) section may include forward-looking statements regarding prospects. These statements entail various known and unknown risks and uncertainties, which could result in material differences between actual results and the forwardlooking statements. The estimates and figures presented in the report are based on certain assumptions made by the Company, considering both internal and external information currently available. However, these assumptions are subject to change over time due to shifting underlying factors, potentially leading to adjustments in the estimates. It is important to note that forward-looking statements reflect the Companys current intentions, beliefs, or expectations only as of the date of their issuance. The Company is not obligated to revise or update any forward-looking statements in response to new information, future events, or other factors.