On Tuesday, one97 Communications, parent of Paytm, reported a net profit of Rs 928.3 crore for the quarter ended in September 2024 after having incurred a loss of Rs 290.5 crore a year ago, as an exceptional gain from the sale of its entertainment ticketing business to Zomato boosted the fintech firm's Q2 scorecard.
Consolidated revenue from operations dipped 34.1% year on year to Rs 1,659.5 crore in the just-ended quarter.
Paytm has announced Profit after Tax, profit attributable to owners of parent at Rs 928.3 crore for the quarter ended September, FY25. The said profit included an exceptional gain of Rs 1,345 crore from the sale of entertainment ticketing business, Paytm said in its earnings statement.
"The company believes that the continued focus on payments and distribution of financial services will drive sustained, profitable growth. The same is reflected in its growing revenue for the payments business of Rs 981 crore, up 9 percent QoQ, and revenue from financial services at Rs 376 crore, up 34 percent QoQ," it said.
Cost: Indirect cost is at Rs 1,080 crore, having decreased by 17 percent qoq. This is on account of a decline in employee costs by 13 percent qoq, along with a decline in marketing expenses and the absence of certain one-time items compared to Q1 FY25.
The company said that new additions to the subscription business of merchants have outpaced the January 2024 numbers. Altogether, the merchant subscriptions stand at 1.12 crore.
"Our plan is to pick up inactive devices and redeploy them after refurbishment, which helps us in reducing capex. When we pick up inactive devices, our merchant count reduces. We plan to continue the act of reactivating merchants and redeploying inactive devices to new merchants over the next 2-3 quarters. This will lead to a higher active merchant base and higher revenue," the company said.
The company should be sharp in focus over the next quarters as compliance-first, continue with merchant payment innovations and customer acquisitions, increase high-margin financial services revenue by expanding financial services partners, and the use of Artificial Intelligence to reduce costs.
The company has also announced starting with DLGs on the distribution of merchant loans.
There is higher interest and comfort from the existing as well as new lenders to expand the partnership because of better trends in asset quality and higher demand from our merchants, following the regulatory framework and emerging market practice, we can see increased willingness from lenders to partner and allocate more capital in the DLG model, it said.
Existing partners' disbursements will increase under the DLG model, and new lender partnerships for loan distribution will expand. This said the company. The company has taken the approval of its Board for a partner offering DLG of Rs 225 crore over time.
Cash balance stands at Rs 9,999 crore as of the quarter ending September 2024 compared to Rs 8,108 crore in the June quarter, the company added.
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