Paytm shares fall 4.6% Second-quarter net loss expands: 10 points

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Paytm shares fall 4.6% Second-quarter net loss expands: 10 points

As at 10.01 am, Paytm shares were up 0.11 per cent at Rs 1,783.15.

Shares of Paytm’s parent company One 97 Communications Ltd fell 4.63 percent in early trading on Monday, with its first earnings report released earlier this month, with costs rising 37.1 percent to Rs. 1,599 crore and the consolidated net loss increased to Rs. 474 crore from Rs. 437 crore.

Here is your 10-point seatsheet for this story:

  1. Paytm, which considers China’s Ant Group and Japan’s Softbank Group as its sponsors, raised $ 2.5 billion this month in India’s largest initial public offering, but made a bad debut in the stock market.

  2. Analysts point to Paytm’s high valuations as the reason for the stock price fall in its first trading session. At 10.01 am, the stock was up 0.11 per cent at Rs 1,783.15.

  3. The company said in a statement to JM Financial clients that the company “faces serious challenges in its acquisition machine, which will slow its revenue growth in the core payments business.”

  4. The company said the value of its total merchandise grew by 52 per cent year-on-year from transactions other than the state-backed peer-to-peer payment network, popularly known as UPI.

  5. Paytm’s operating income rose 63.6 per cent to Rs 1,086 crore for the quarter ended September.

  6. Paytm competes with Google and Walmart Inc’s PhonePe in India’s digital-payment marketplace, and all of these companies offer peer-to-peer payments in UPI.

  7. Founder and CEO Vijay Sehgar Sharma says it will take time for investors to understand the company’s business.

  8. “Some of the tax items in our payment business are not only profitable, they create free cash flow,” Mr Sharma said. “Our revenue and contribution limits are increasing in the context of the payment and financial services business, where payments are the primary driver.”

  9. Madhur Deora, chief financial officer of Paytm’s Group, said that its business, cloud and financial services businesses had great potential to make more money for the company.

  10. Paytm offers services including business fees, insurance and gold sales, movie, air ticket and bank deposit.

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