Paytm on Friday said profitability and revenue should start improving from the second quarter due to better cost management, sending its shares higher, even as it posted its biggest quarterly loss since going public in 2021.
The digital payments firm, hit by the wind down of its payments banking unit earlier this year, expects operating metrics, including the gross merchandise value and merchant device additions, to improve and employee costs to come down from July-September.
Paytm’s shares, which fell nearly 3% ahead of the results, turned positive to rise 2%.
“Operating metrics such as gross merchandise value and merchant loans are improving. Worst is priced in and thus should start seeing better stock performance hereon with the results,” said Rahul Jain, vice president of Research at Dolat Capital.
Paytm’s consolidated net loss widened to 8.39 billion rupees ($100.3 million) for the quarter ended June 30, compared with a loss of 3.57 billion rupees a year ago.
Earlier in the year, the Reserve Bank of India wound down Paytm Payments Bank due to persistent compliance issues, triggering a meltdown in Paytm’s stock.
The restrictions also led to a number of lending partners halting loans given out via the company’s platform, leading to a 1.4% sequential decline in loans during the current quarter.
Paytm’s EBITDA before cost of employee stock options stood at negative 5.45 billion rupees for the June quarter, broadly in line with its earlier estimate of 5 billion rupees-6 billion rupees.
Revenue from operations fell 36% to 15.02 billion rupees in April-June, in line with its the company’s estimates of 15 billion rupees-16 billion rupees.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed - Reuters)