News

Published: October 23, 2023
Updated: October 23, 2023

Paytm Reports Strong Q2 Results, Narrowing Losses and Surging Revenues

Steady Loan Growth Boosts Paytm's Q2 Performance

Indian digital payment giant, Paytm, has demonstrated its financial prowess by posting an operating profit for the fourth consecutive quarter. The robust financial performance is attributed to substantial growth in its financial services unit, where steady loan growth has played a pivotal role.

Impressive Revenue Growth

Paytm, which was among the country's early startups to go public, reported a remarkable 32% increase in revenue for the second quarter. Revenues surged to Rs 2,519 crore, up from Rs 1,914 crore in the same period the previous year.

Turning Losses into Profits

A significant milestone for Paytm is the transformation of losses into profits. The company defined operating profit, which excludes the cost of employee stock-owning plans, amounted to Rs 153 crore for the quarter ending on September 30. This marks a substantial turnaround from the previous year when Paytm reported losses in the same period.

Consistent Profitability

This isn't a one-time occurrence for Paytm, as they had already posted a core profit of Rs 84 crore in the first quarter, further solidifying their consistent profitability.

Improvement in Net Loss

While Paytm has yet to post a net profit since its public offering in November 2021, the company reported a significant reduction in consolidated net losses. The net loss narrowed to Rs 291 crore from Rs 571 crore in the preceding year, signalling a positive trend in the company's financial performance.

Core Payments Business Growth

Paytm's core payments business also demonstrated substantial growth, with revenues surging by 28%. This achievement showcases the company's continued dominance in the digital payment industry.

Financial Services Unit Thriving

The financial services unit, which includes Paytm's loans business, has experienced impressive growth, with a 64% rise in revenues. The value of loans distributed more than doubled, reaching Rs 16,211 crore, underscoring Paytm's expanding influence in the financial services sector.

Market Reaction and Share Performance

Investors have responded positively to Paytm's strong financial results, with the company's shares closing 2% higher ahead of the results announcement. Paytm's shares have enjoyed an 86% increase in value throughout the year, while the broader Nifty Financial Services sector has seen a more modest 3.3% rise.

Paytm's latest financial results are a testament to the company's resilience and ability to adapt in a rapidly evolving financial landscape. With consecutive operating profits, narrowing losses, and impressive revenue growth, Paytm is undoubtedly a major player in India's digital payment and financial services industry. These results position the company for continued success and innovation in the years to come.