Digital payments app Paytm’s parent One 97 Communications Ltd on Friday reported its consolidated loss narrowed by nearly 50% to Rs 392 crore in the quarter ended December 31, 2022 as against loss of Rs 778.5 crore in the year-ago period.
The SoftBank-backed firm’s revenue from operations rose 42% to Rs 2,062 crore in Q3FY23 as against Rs 1,456 crore in Q3FY22.
On Friday, Paytm’s scrip on BSE closed nearly 3% lower at Rs 530. The firm said it achieved EBITDA profitability before ESOP costs, three quarters ahead of its guidance and reported EBITDA before ESOP of Rs 31 crore in Q3FY23.
“Paytm, a business built from scratch with conviction on Digital India. From our first app release to becoming a verb in India to operating EBITDA profitability milestone – all in 10 years!” said CEO Vijay Shekhar Sharma on Twitter.
Paytm, a business built from scratch with conviction on Digital India.
From our first app release to becoming a verb in India to operating EBITDA profitability milestone – all in 10 years !
Super Proud of @Paytm team. 🤗
Thankful to all who have supported & cheered us along. 🙏🏼 https://t.co/h8AMTVw5wn
Revenue growth was driven by increase in merchant subscription revenues, growth in loan distribution and momentum in commerce business, said the company in a stock exchange filing.
“I wrote to you on April 6, 2022, and set a target for EBITDA before ESOP cost breakeven by the September 2023 quarter. I believe the opportunity in our country for newer payment and credit disbursement solutions is huge, which gives us quality revenue and attractive profit pools to address. With our focus on growth and keeping a tight vigil on operational risk and compliances, I am very confident that we will soon achieve our next milestone of becoming a free cash flow generating company,” Sharma told Paytm shareholders in a letter.
The company’s contribution profit improved to 51% of revenue in Q3FY23 from 31% in Q3FY22 and 44% in Q2FY23, driven by improvement in payments profitability, and growth of high margin businesses, such as loan distribution, it said.
Number of loans disbursed through Paytm rose 137% to 10.5 million for Rs 9,958 crore. “As of December 2022, 8.1 million borrowers have taken a loan on our platform, adding 1.4 million new borrowers this quarter. Growing borrower base offers tremendous upsell and lifecycle benefits. Our payments consumer and merchant base offers a large addressable market, thereby providing a long runway for growth,” said the company in exchange filing.