Paytm swings to profit in Q2 FY24, driven by ticketing biz sale to Zomato
One 97 Communications, the parent company of Paytm, saw its revenue from operations rise 10.51% in Q2 FY24 to Rs 1,659.5 crore from Rs 1,501.6 crore in Q1 FY24.
Fintech company Paytm reported a profit of Rs 930 crore in Q2 FY24 compared to the loss of Rs 840.1 crore in the previous quarter, owing to the gains it received from the sale of its ticketing business to Zomato.
On August 21, the company finalised the sale of its movie ticketing and events businesses to Zomato for Rs 2,048.4 crore, resulting in a closing amount of Rs 2,013.6 crore after adjustments and a gain of Rs 1,345.4 crore, it said in a BSE filing.
One 97 Communications, the parent company of Paytm, saw its revenue from operations rise 10.51% in Q2 FY24 to Rs 1,659.5 crore from Rs 1,501.6 crore in Q1 FY24.
In Q2 FY23, the company reported Rs 2,518.6 crore in revenue from operations and a loss of Rs 291.7 crore.
The total income rose 11.89% to Rs 1,834 crore in Q2. However, it was down by 31.09% from Rs 2,662.5 crore in the corresponding quarter last year.
Paytm also incurred payment processing charges of Rs 516.8 crore, a slight decrease of 0.06% compared to Rs 517.1 crore in Q1. Year-on-year, payment processing charges fell by 36.77%, down from Rs 816.7 crore in Q2 FY23.
Employee benefits expense also fell 12.73% to Rs 831 crore in Q2 from Rs 952.5 crore in Q1. It was down 30.30% at Rs 1,191.5 crore in Q2 FY23.
Overall, total expenses for Q2 amounted to Rs 2,244.8 crore, a decrease of 9.34% from Rs 2,476.4 crore in Q1. Paytm saw its total expenses decrease by 23.58% from Rs 2,936.7 crore in Q2 FY23.
In the filing, the company reported that new subscription-paying device merchant sign-ups for its merchant subscription business "have surpassed levels seen in January 2024", bringing the total number of merchant subscriptions to 1.12 crore.
In an effort to optimise resources, Paytm plans to "pick up inactive devices and redeploy them after refurbishment," which will help reduce capital expenditures, it added.
Vijay Shekhar Sharma, Founder and CEO of Paytm, emphasised that while collecting inactive devices may temporarily decrease the merchant count, the strategy aims to "continue reactivating merchants and redeploying inactive devices to new merchants" over the next 2-3 quarters. This approach is designed to bolster the active merchant base, leading to increased revenue.
Further, the company informed the BSE that it has a cash balance of Rs 9,999 crore as of the quarter ending September 2024 compared to Rs 8,108 crore in the previous quarter.
(This is a developing story.)
Edited by Suman Singh