A brokerage has initiated coverage on Pine Labs with a BUY rating and a price target of ₹250, citing strong growth expectations across its payments and issuing businesses. The brokerage estimates 24% revenue CAGR, 46% adjusted EBITDA CAGR and 129% PAT CAGR over FY26-28E. It expects adjusted EBITDA margins to improve to 28.7% by FY28E from around 9% in FY24. The Digital Infrastructure and Transaction Platform is expected to remain the largest revenue contributor, with estimated 24.5% revenue CAGR. The Issuing and Acquiring Platform is also expected to scale, with FY26 GTV growing 24% YoY to ₹640 billion and an estimated 25% GTV CAGR through FY28E. The key trigger is the expected monetisation of Pine Labs' payments infrastructure, supported by merchant transactions, prepaid programs and international expansion. However, the ₹250 target is a brokerage estimate based on 25x FY28E EV/EBITDA, so actual performance will depend on revenue growth, margin expansion and execution. I will track GTV growth, EBITDA margins and the pace of international expansion as key indicators. View: Positive. The brokerage's estimates point to strong earnings growth, but the projected margin expansion and valuation assumptions need to play out for the ₹250 target to be justified.

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