Indian fintech giant Paytm on Friday reported a quarterly loss that narrowed by 77% year-on-year, helped in part by a jump in loan growth, amid pressure to turn profitable ever since its dismal listing in 2021.
For the fourth quarter ended March 2023, Paytm’s parent, One 97 Communications Ltd, posted a consolidated net loss of Rs 168 crore, compared with Rs 761 crore a year ago. Its revenue from operations rose 51% to Rs 2,334 crore in the period.
The company, in the past, has said it expects to turn profitable by Sept. 2023.
In the fourth quarter, the number of loans distributed through the platform grew 82% to 1.2 crore, while the value of loans distributed grew to Rs. 12,554 crore, a growth of 253%, year over year.
As of the quarter ending March 2023, the company had Rs. 8,275 crore as cash balances as compared to Rs. 9,271 crore as on March 2022.
Paytm, backed by China’s Ant Group, had raised $2.5 billion in its initial public offerings — one of India’s biggest last year. However, the company made a dismal debut following concerns over its high valuation and an uncertain path to profitability.
The stock has lost 67% so far from its IPO price of Rs 2,150. Valuations of several new-age companies, including Nykaa and PB Fintech, have taken a beating in the private market as the craze for startups wanes, possibly delaying plans to go public. Given the low-risk appetite in the Indian equity markets at present and the highly uncertain economic scenario in the medium and long term, investors are reluctant to invest in startups.
In the highly competitive UPI space in India, PhonePe, with over 400 million registered users, has outranked Google Pay and Paytm with a more than 45% market share of the transactions. PhonePe’s current valuation of $12 billion also puts it ahead of digital payments unicorn Razorpay, which was last valued at around $7.5 billion.
