Breaking: Paytm Parent's Q4 Revenue and Loss Surge!

Loss Widens as Paytm Parent Reports Q4 Revenue!

One 97 Communications, the parent of payments aggregator paytm, has said it expects to see the full financial impact of the “temporary disruptions” in the first quarter of FY25, following the Reserve Bank of India’s restrictions on the fintech in January.

As a result, June quarter revenues are likely to range between Rs 1,500 crore to Rs 1,600 crore, the company said.

However, the company it is confident of seeing a meaningful improvement starting from the September quarter (Q2FY25), based on restarting aused products and achieving steady growth in its operating metrics.

It is also planning to double down its focus on insurance and wealth to “improve bottomline.”

On Wednesday, One 97 Communications reported a fall in its fiscal fourth quarter revenue, hurt by a dwindling customer base after the regulatory authorities directed the payment giant to half certain banking activities.

Losses also winded for the three months through March on the back of an impairment of Rs 227 crore for carrying the value of company’s investment in Paytm Payments Bank Ltd, it said in a statement.

Revenue fell to Rs 2,399 crore in the quarter ended 31 March 2024, from Rs 2,465 crore a year earlier. Losses during the period widened to Rs 551 crore compared to Rs 168 crore from a year earlier.

Since the beginning of this year, the Paytm stock has declined a significant 46 percent. Shares were down over 1 percent at Rs 346.75 apiece on the National Stock Exchange following the announcement of the results.

“We have successfully transitioned our core payment business from PPBL (Paytm Payments Bank Ltd) to other partner banks. This move de-risks our business model and also opens up new opportunities for long-term monetization, given our platform’s strength around customer and merchant engagement,” said Paytm founder and chief executive, Vijay Shekhar Sharma, in the annual shareholder letter.

The company, meanwhile, is also undergoing a restructuring and has seen several top level exits in recent months.

Earlier this year, the Reserve Bank of India (RBI) directed Paytm payments Bank Ltd to half new credit and deposit operations, top-ups and fund transfers, among other banking activities. This action followed a comprehensive audit by external auditors, uncovering consistent non-compliance, besides supervisory concerns within the bank.

Despite these restrictions posing a risk of losing customers and merchants, the company has shown signs of a recovery.

In March, it had obtained approval from the National Payments Council of India (NPCI) to operate as a third-party app, allowing it to function as competitors such as Google Pay and PhonePe.

Additionally, it has partnered with Axis Bank, HDFC Bank, State Bank of India and Yes Bank to ensure smooth business migration, demonstrating proactive measures to address operational challenges.