Paytm Q4: One97 Communications’ founder and CEO Vijay Shekhar Sharma said Paytm is looking to be operating EBITDA breakeven (Ebitda before Esop cost) by end of September 2023, in a filing with the exchanges on Wednesday morning.
In a letter to shareholders, while announcing its last quarter results, Sharma said against the backdrop of volatile market conditions for high growth stocks globally, Paytm’s shares are down significantly from the IPO price.
Paytm had offered shares to the public at Rs 2,150 apiece at a market valuation of Rs 1.39 lakh crore. The stock has been on a downward trend since its listing in November 2021 and has fallen more than 70 percent with market capitalisation watering down to Rs 41,000 crore.
BSE had recently sought clarification from Paytm on the massive slide in its stock price. Shares of the company have fallen on the back of receding interest among investors for loss-making growth companies in light of higher interest rates, confusion about Paytm’s road to profitability, and recent regulatory actions against the company.
“Dabbling in multiple business lines inhibits PayTM from being a category leader in any business except wallets, which are becoming inconsequential with the meteoric rise in UPI payments,” brokerage firm Macquarie had said in a recent note.
Sharma assured investors that the entire Paytm team is committed to building a large, profitable company and creating long-term shareholder value. However, experts suggest otherwise.
Santosh Meena, Head of Research, Swastika Investmart Ltd., said: “Paytm, one of the biggest wealth destroyers is attracting some buying interest in the 500-600 zone amid lots of negativity. Some investors are finding it attractive at current levels due to its brand value however there are still uncertainties about the timing of its profitability whereas there is no leadership in any particular business. We are expecting some recovery in this counter due to bargain buying where we can expect 770/870 levels in the coming days however conservative investors should completely avoid this stock.”
Fintech major Paytm’s Chief Executive Officer also said that he will be granted his employee stock options (ESOP) only when the market capitalisation of the company crosses the level it was at during the initial public offering.
The firm had granted ESOPs to Sharma for the first time since the founding of the company in September 2021.
One97 Communications (Paytm) Q4 Update
Lending business scales to 6.5 million loan disbursals during the quarter aggregating to a total loan value of Rs 3,553 crore ($474 million) during the quarter (YoY growth of 417 per cent). Offline payments business accelerates with 0.9 million devices deployed in this quarter. The total number of devices deployed grew to 2.9 million. Paytm Super App average monthly transacting users (MTU) for the quarter grows 41 per cent YoY to 70.9 million. Over 104 per cent YoY increase in GMV for the quarter at Rs 2.59 lakh crore ($34.5 billion), the company said in an exchange filing.
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