One97 Communications, the parent firm of Paytm, ended the financial year 2021-22 (FY22) with a net loss of ₹2,396 crore as against a loss of ₹1,701 crore in the previous fiscal, weighed down by higher expenses. The digital payment company, which competes with Google Pay and PhonePe, reported 77% growth in its revenue from operations at ₹4,974 crore as compared to FY21, driven by strong growth in revenue from financial services like lending, paytm money, insurance and other services like fastag sales.
On the operating front, Earnings before Interest, Taxes, Depreciation, and Amortisation (EBITDA) loss for the FY22 before ESOP costs narrowed to ₹1,518 crore, from ₹1,655 crore in FY21. However, the company remained optimistic to achieve operating breakeven by the quarter ending September 2023.
“As announced in April 2022, we believe we will achieve operating breakeven (i.e EBITDA before ESOP cost) by September 2023. This will be driven by continued revenue growth, along with moderation in costs as operating leverage kicks in,” One97 Communications said in an exchange filing on late Friday.
During the January-March quarter of 2022, Paytm saw its consolidated net loss widening to ₹762.5 crore as compared to a loss of ₹444.4 crore in the corresponding quarter of the previous fiscal. However, the consolidated revenue from operations jumped 89% to ₹1,540.9 crore compared with ₹815.3 crore in Q4FY21. As per the company, the key drivers for revenue growth were spurt in merchant payments processed through Merchant Discount Rate (MDR) bearing instruments (Paytm Wallet, Paytm bank account, cards), as well as disbursements of loans through its partners on Paytm platform.
In Q4 FY22, Paytm’s contribution profit - as defined by revenue from operations less direct costs - improved to 35% of revenue in the quarter from 21.4% a year ago. The EBITDA loss before costs of employee stock options declined 12% year-on-year during the quarter, while margin improved to (24%) of revenues from (51%), as per the filing.
The company said that it continued to invest in expanding its user base, with its average monthly transacting users (MTU) in March quarter growing by 41% YoY to 70.9 million. The MTU gauges the number of unique users with at least one successful payment transaction in a month.
On the lending front, the company has recorded significant growth over the last year, with the number of loans distributed through Paytm surging 374% YoY to 6.5 million. The total loans disbursed amounts to ₹3,553 crore in terms of value, a growth of 417% YoY.
Segment-wise, revenue from the financial services & others category surged 342%, followed by payments services to merchants (90%), payments services to consumers (69%), and commerce and cloud services to merchants (61%).
The payment solutions company also clarified on the deviation of funds raised through initial public offer, saying that there was no variance in the utilisation of proceeds of the initial public offering (IPO) from the objects stated in the prospectus dated November 11, 2021. The company had raised ₹18,300 crore from public offering, which was the country’s biggest-ever IPO until LIC.
Paytm has been the worst performer on the S&P BSE IPO index, with its share price plummeting 75% since its listing on November 18, 2021. On Friday, Paytm shares closed at ₹575.35, up 3.9% on the BSE, in sync with benchmark indices, which surged nearly 3% in broad-based rally.