Paytm Q1 Results: Paytm suffers loss of Rs 840 crore in June quarter, biggest loss since listing

Paytm Q1FY25 Results: Paytm brand owner company ‘One97 Communications’ has announced disappointing quarterly results. The company’s loss has increased to Rs 840 crore during the three months ended June 30. This is the company’s biggest quarterly loss since listing. During the same period last year, the company had recorded a loss of Rs 358.4 crore. The company has given information about these financial results in a regulatory filing on Friday. The ban on Paytm’s payment banking business is being blamed for this decline in the company’s performance. Despite these poor results, Paytm has expressed hope that its revenue and profitability will improve during the second quarter.

All-round decline in financial performance

During the April to June 2024 quarter, the consolidated revenue of fintech firm ‘One 97 Communications’ declined by 33.48 per cent to Rs 1,639.1 crore, as against Rs 2,464.2 crore in the same quarter last year. The public issue of the company, which owns the Paytm brand, came in November 2021. The loss for the June 2024 quarter is the biggest loss since then. In the June quarter, the company’s EBITDA before the cost of employee stock option was negative i.e. minus Rs 545 crore. In the earlier estimates, it was also estimated to be between (-) 500 crore to (-) 600 crore rupees. During the June quarter, the income from the company’s payment business declined by about 39 per cent, while the contribution of payment business to its total revenue has been about 69 per cent. The revenue of the company’s financial services unit has declined by 86 percent during this period.

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Action taken due to problems related to compliance of rules

Due to the instructions of the Reserve Bank, Paytm has had to shut down its payment bank business. RBI took this action against the company after several compliance related flaws were found in its payment banking business. Although Paytm’s app is still being used for digital payments, other banks have to be used for this. Also, Paytm’s fastag and wallet have been shut down. In May itself, the company had said that the full impact of RBI’s action is likely to fall on its June quarter results.

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After RBI’s action, Paytm’s shares have seen a huge fall. However, after the quarterly results were announced on Friday, there was no fall in the shares of One 97 Communications. Rather, around 12:10 pm, the company’s shares were trading at Rs 448 with a rise of about 0.60%. However, during the last 6 months, the company’s shares have fallen by about 41 percent.