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One 97 Communications, the parent company of Paytm, has reported a 49% year-on-year reduction in losses for Q2 FY24 to 291.7 crore rupees ($3.49 million), marking its fourth consecutive quarter of operating profit. This decrease in losses is attributed to increased gross transaction value (GTV), revenues from merchant subscriptions for services such as the Soundbox device, and a surge in loan distribution.
The digital payment operator recorded a 32% increase in operational revenues, reaching 25.19 billion rupees ($300.96 million) for the quarter ending September 30, 2023. This growth was seen across both its core payments business and its financial services division, which saw revenue increases of 28% and 64% respectively. According to InvestingPro data, Paytm’s revenue for the last twelve months leading up to the second quarter of 2023 was $55.28 million, and despite a slight slowdown in revenue growth, it still managed to record a 1.59% increase.
Notably, the value of loans distributed more than doubled to 162.11 billion rupees. Despite these operational achievements, Paytm has yet to register a net profit since its IPO in November 2021. It has succeeded in reducing its consolidated net loss to 2.91 billion rupees from 5.71 billion rupees. This aligns with an InvestingPro Tip that indicates analysts do not anticipate the company will be profitable this year.
The company’s operating profit for the quarter, after considering the cost of employee stock-owning plans, amounted to 1.53 billion rupees. This is a significant turnaround from the loss of 1.66 billion rupees reported in the same period last year. This is reflected in the company’s EBITDA for LTM2023.Q2, which according to InvestingPro data, stands at $16.47 million, marking a growth of 10.02%.
While Paytm continues to show strong performance in its core business and financial services division, it has not yet turned a net profit since going public nearly two years ago. Still, it’s worth noting that the company’s stock has seen a strong return over the last month, as per InvestingPro Tips. Its market capitalization, adjusted to current rates, is $71.8 million. Despite not paying a dividend to shareholders, Paytm remains a prominent player in the Financial Services industry. For those interested in more insights like these, there are additional tips available on InvestingPro.
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