In its recent reports, financial technology giant Paytm, or One97 Communications, revealed that the company has witnessed a jump in its revenue. This is the first time Paytm released its revenue figures since its recent stock market debut.
Following a successful IPO, the tech firm is now planning to meet its objectives to bring value to its stakeholders. In the midst of this, such reports are undoubtedly positive.
Read on to know the highlights of this report.
Highlights of Paytm’s Recent Financial Report
One97, the parent company of Paytm, has reported on Saturday, i.e. 27 November 2021 that its revenue from operations has increased by 64%. This is a year-on-year growth that took the company’s total earnings from this section to Rs. 1,090 crores in the Q2 of FY2022.
Moving ahead, Paytm’s earnings from the non-unified payment surfaces have grown by 52% in the 2nd quarter of this fiscal year. Along with this, the earnings from the cloud and commerce section has registered 47% year-on-year growth to reach Rs. 244 crores.
Furthermore, Paytm’s revenue from payment and financial services has also improved by 69% year-on-year to reach Rs. 843 crores. Further details of earnings from this segment include –
- Income from payment services to customers is up by 54% to Rs. 354 crores.
- Income from payment services to merchants is up by 64% to Rs. 400 crores.
This rise in proceeds from payment services can be attributed to the increase in non-UPI payments through Paytm’s platform.
Moreover, Paytm’s contribution to profit increased to Rs. 260 crores and its contribution margin went up by 24%, from 5.7% of the previous year.
Now, let’s take a look at the expenses mentioned in the report for a better idea of proceedings.
In the same statement, Paytm has also mentioned that its total expenses soared to about Rs. 1,600 crores from Rs. 1,170 crores in 2021. A notable portion of these expenses includes marketing and promotional expenditure, which does not entail incentives and cashback. This segment accounts for almost Rs. 102 crores, which is a 40% rise compared to that of FY2021. Moreover, the company has improved its average MTUs by 14.4 million from the second quarter of FY2021 to FY2022.
The next in line is Paytm’s employee expenses, which are currently at Rs. 367 crores from this quarter. It is a 37% increase from the previous fiscal year but reduced to 34% of revenues of Q2 FY2021 from 40% in FY2021.
Furthermore, the company has also mentioned that it has adjusted the EBITDA margin to 39% of its earnings in this quarter.
Lastly, the net loss for this quarter stands at Rs. 482 crores, which is a rise of 11% on a Y-o-Y basis and a 28% rise when compared to that of the June quarter.
The news of loss may not be something that investors look forward to reading, but there are positives too. Firstly, Paytm is well-funded with pro forma cash that gives it a good enough cushion in terms of conducting its operations smoothly. Additionally, the lending part of their business is growing rapidly, with 2.8 million loans disbursed in the 2nd quarter of FY2022.
Nonetheless, following a post-IPO slum, a report like this will only increase investors’ confidence and bring in more value to this business.
For any updates related to India’s stock market, stay subscribed to the Angel One Blogs.
Frequently Asked Questions
- What was the size of Paytm’s IPO?
Paytm’s IPO had a valuation of about Rs. 18,000 crores, which is India’s biggest public issue to date.
- What is Paytm’s GMV value of October 2021?
Paytm’s overall gross merchandise value of October 2021 is Rs. 832 billion.
- What is the current sector PE ratio of Paytm’s shares?
The current sector PE ratio of Paytm’s shares is 110.09.