One 97 Communications Ltd, the parent company of Paytm, clocked a net loss of Rs 550 crore in the January-March period of FY24, a 3.2 times jump compared to the same period in the last fiscal year. Paytm’s revenue was down by 20 per cent compared to the previous quarter.
Its quarterly result took a beating after the Reserve Bank of India’s (RBI) ban on some of the services of Paytm Payments Bank (PPBL). The company posted a 3 per cent decline in its revenue for the fourth quarter of FY24 to Rs 2,267 crore.
This comes as the company plans to achieve significant cost efficiencies through artificial intelligence (AI)-led capabilities. The digital payments major is planning a “leaner organisation structure” and the “pruning of non-core businesses”, indicating there may be job redundancies at the company in the near future.
Tag: Paytm
-
Paytm posts Rs 550 crore loss in Q4, hints at job cuts
-
Paytm lists at Rs 1,950, shares plunge 21% in first day of trade
Shares of One 97 Communications, the parent company of digital payments company Paytm, debuted on the stock market on Thursday. The stock was opened for trading at Rs 1,950 on the NSE, marking a drop of 9.3% or Rs 200 from its issue price of Rs 2,150. Paytm shares extended losses after l opening, with the stock falling 21% from the issue price, reaching an intraday low of Rs 1,705.
Paytm’s 18,300 crore IPO, which was the largest in the country, was underwritten 1.89 times last week. On BSE, the Paytm share was opened for trading at Rs 1,955.
Despite the decline in Paytm shares in its early days, the company recorded a valuation of over Rs 1 lakh crore.
Analysts said Paytm’s expensive valuations were the reason for the stock price plummeting in its first trading session.
The IPO of Paytm consisted of a new issue of Rs 8,300 crore and an offer to sell (OFS) by existing shareholders valued at Rs 10,000 crore. Paytm awarded shares worth Rs 8,235 crore to more than 100 institutional investors, including the Singapore government, ahead of the country’s largest stock exchange listing.
Paytm has attracted the interest of 122 institutional investors who bought more than 3.83 crore of shares for Rs 2,150 a piece, according to a regulatory document dated November 3.
Engineering graduate Vijay Shekhar Sharma founded Paytm in 2010 as a mobile top-up platform. The company grew rapidly after ride-sharing company Uber listed it as a fast-payment option in India and its use increased further in late 2016 after the shock ban on high-value banknotes boosted digital payments.
Paytm’s success made Mr. Sharma, the son of a schoolteacher, a billionaire with a net worth of $ 2.4 billion according to TSWT. Its IPO also struck hundreds of new millionaires in a country where per capita income is less than $ 2,000.
-
Investors devour Zomato shares as IPO kicks off
New Delhi (TIP): Retail investors snapped up shares of Zomato Ltd on the first day of its much-awaited initial public offering, maintaining their enthusiasm for the primary market manifest in every IPO of the year. Within minutes of opening, the retail segment of the Zomato IPO was fully subscribed, and by the end of the day, small investors had bid for 2.85 times the number of shares on offer. At the upper end of the Rs 72-76 price band, the IPO drew retail bids worth roughly Rs 2,655 crore. Retail investors were also enthused by the previous day’s Rs 4,196 crore anchor investment, where marquee investors were allotted 552.17 million shares at Rs 76 each.
The portion of shares reserved for non-institutional investors was subscribed just 14%, while that for qualified institutional buyers (QIB) was subscribed 1.03 times.
The overall subscription was 1.11 times on the first day of the three-day share sale, with bids for 756.43 million shares received against the 681.38 million shares on offer.
Zomato is India’s first major new-age technology company to go public. The keen retail interest witnessed in the Zomato IPO on the first day is likely to bode well for other technology companies preparing their IPOs, including Paytm, MobiKwik, Nykaa and PolicyBazaar.
-
Indian-Origin MR Rangaswami gets Canada-India Business Council’s ‘Global Service Award’
WASHINGTON (TIP): Indiaspora’s Founder, MR Rangaswami, has been recognized by the Canada-India Business Council with its new 2020 ‘Global Service Award’ for launching Indiaspora and connecting the Indian diaspora globally.
The award was presented virtually on Thursday as part of the Canada-India Business Council’s virtual Diwali Awards from 5 pm – 6 pm EDT, according to media release.
The inaugural award is given to an individual who demonstrates excellence, and a record of exceptional service for the betterment of others.
The ‘Global Service Award’ recognizes selflessness, dedication, and a significant contribution to either Canada or India. “It’s an awesome privilege to accept this award from the prestigious Canada-India Business Council,” said Rangaswami, a Silicon Valley software executive, investor, and entrepreneur. “This award will give us momentum on our journey of connecting the Indian diaspora globally and making an impact,” he said. “We view Canada and Indo-Canadians as an integral partner in this mission.” “MR has served in numerous ways throughout his life, with grace and humility. What he has done in eight short years through Indiaspora, by convening, mobilizing, and catalyzing key diaspora leaders in the United States and around the world, is nothing short of remarkable,” said Victor Thomas, President and CEO of Canada-India Business Council. “We are thrilled to recognize him with the Canada-India Business Council’s first-ever ‘Global Service Award.’” “The 1.6 million strong Indian community — affluent, hard-working, peaceful and fully integrated into the Canadian ethos — is a living bridge fostering people to people ties between India and Canada,” said Apoorva Srivastava, Consul General of India in Toronto. “The community is making a significant contribution to the growth and prosperity of Canada, which is well recognized by Canadian society and the government.”
“There are several organizations who are working tirelessly for the well-being of the community members,” said Srivastava, one of the presenters at the Diwali Awards event.
“Indiaspora is one such organization, which since its inception, has amplified the voice of the community and transformed it into a vibrant and dynamic force.”
“I congratulate Rangaswami and the Indiaspora team for their stupendous work in the service of the community. Today’s award is a recognition of their efforts in helping the community to unite together for their common good,” said Srivastava.
As part of its “Global Connect” program to lead high-level delegations of the Indian diaspora to different countries, Indiaspora organized a delegation of their members and prominent friends from the US to Canada to meet Canadian, Indian, and Indo-Canadian leaders in government, academia, philanthropy, the arts, finance, business and technology in October 2018.
The “Track II” diplomacy meetings took place in Toronto and Ottawa in the wake of the United States-Mexico-Canada Agreement (USMCA) proposed earlier that month, as well as Prime Minister Trudeau’s trade trip to India earlier that year, the release said.
“MR is a true example of how to provide selfless service while making a meaningful impact in the world through various initiatives, including as founder of Indiaspora,” said Sukesh Kumar, a Partner and National Leader of KPMG’s India Practice, and an Indiaspora Patron who has played a leading role in Indiaspora’s Canadian activities.
“What makes him even more special is his humility and approaching every situation with a smile.”
“I was delighted to be a part of Indiaspora’s high-level delegation to Canada led by MR Rangaswami. The enthusiasm to engage with our group, which was evident among Indo-Canadian leaders in diverse professions, was testament to his amazing relationship building and convening capacity,” said Arjun Divecha, a US-based investor who is head of Grantham, Mayo, Van Otterloo & Co’s Emerging Markets Equity team and an Indiaspora Founders Circle member who was part of Indiaspora’s delegation to Canada.
“Under his dynamic, visionary leadership, Indiaspora is fast becoming a premier organization working to build meaningful relationships across Indian diaspora leaders globally, including of course in Canada.”
Patricia Koval, Chair of the Canada-India Business Council will be introducing the ‘Global Service Award’ before Rangawami’s remarks.
Other Canada-India Business Council honorees include: Paytm Canada CEO Harinder Takhar with the Member of the Year Award; G(irls)20 Acting-CEO Bailey Greenspon with the Roy MacLaren Humanitarian Award; and Teck Resources Limited President and CEO Donald Lindsay with the Thomas Bata Corporate of the Year Award.
-
PAYTM GETS RS 9,079 CRORE IN ITS WALLET FROM SOFTBANK
TO INTRODUCE NEW FINANCIAL PRODUCTS
-
? The funding will help Paytm expand its soon-to-be launched payments bank operations as well as grow its user base and introduce more financial products for consumers
-
? SoftBank has committed investments of over $10 billion in India. While it has pumped in close to $2 billion into Indian startups like Snapdeal, Ola and Housing.com in the past few years, it has also written off a significant portion of that on account of loss in valuation
-
? With this round of funding, SoftBank joins long-time partner Alibaba Group as a major shareholder and will take a seat on the Paytm Board
NEW DELHI (TIP): Digital payments platform Paytm today announced that Japanese internet and telecom major SoftBank Group has pumped in $1.4 billion (over Rs 9,079 crore) into it.
This is the largest round of funding from a single investor in India. SoftBank joins long-time partner Alibaba Group as a major shareholder and will take a seat on the Paytm Board. Paytm plans to invest Rs 10,000 crore (approximately $1.6 billion) over the next three to five years towards its commitment to enabling half a billion Indians join the mainstream economy.
As a part of this vision, the company will soon launch the Paytm Payments Bank, a mobile-first product that will reach every corner of the nation.
This investment will help Paytm grow its leadership in the country’s payment ecosystem, expand its user base and build a suite of financial services products for its users, a company statement said.
Masayoshi Son, Chairman & CEO, SoftBank Group Corp., said, “In line with the Indian government’s vision to promote digital inclusion, we are committed to transforming the lives of hundreds of millions of Indian consumers and merchants by providing them digital access to a broad array of financial services, including mobile payments. We are excited to partner with Paytm in this journey and will provide them with all our support.”
Paytm founder and CEO Vijay Shekhar Sharma said, “We are at an inflection point in our journey with Paytm. We believe we have a great opportunity to bring financial inclusion to half a billion Indians.”
Eric Jing, CEO, Ant Financial, said, “India has presented us with the world’s largest opportunity in terms of financial services and we are confident its market will grow exponentially over the next decade”. In January 2014, it launched the Paytm Wallet, which has emerged as India’s biggest digital wallet with over 220 million users and is accepted as the preferred mode of payment by over 5 million offline merchants across India.
-
-
Paytm to levy 2% fee on top up with credit cards
NEW DELHI (TIP): Paytm users will now have to pay a 2% fee for adding money to their wallets using credit cards. The move by the Alibaba-backed company came after it found multiple users using its platform to get free credit by using credit cards to top up their mobile wallets and transferring the money back to their bank accounts at zero transaction cost.
Paytm has started levying the fee from yesterday. However, adding money using other payment options like debit cards and net banking would remain free. “Some financially savvy users (surprisingly many of them employees of national financial institutions) exploited this model to rotate money. This may surprise normal users like most of us but for a savvy user, it meant freebies at Paytm’s cost,” Paytm said in a blog post.
Paytm said it pays “hefty charges” when consumers use their credit card to card networks and issuing banks and therefore, if users simply add money from credit card to wallet and transfer the amount to bank, it loses money. “Our revenue model requires users to spend money within our network and we make money from the margins available to us on various products/services we offer,” it said.
To avoid the misuse, Paytm “will put two per cent fee (inclusive of taxes) only on adding money to wallet using credit cards”, it added.
Meanwhile, MobiKwik today said it will allow consumers to top up wallets using credit cards without any additional charges.
-
Snapdeal, Truecaller tie up for better shopping experience
NEW DELHI (TIP): Online marketplace Snapdeal, which is also the third largest e-commerce company of India, said on Thursday that it has partnered with Truecaller to enhance consumer experience by integrating Truecaller Priority in the company’s IVR and order confirmation numbers. Customers with Truecaller application installed on their mobiles will be able to easily identify and filter IVR or delivery verification calls when shopping on Snapdeal, the company said in a statement.
“It will help reduce a key friction point in the delivery process; ensuring that our customers don’t miss out on any important calls from Snapdeal, and also increase the daily rate of deliveries for us by increasing the call completion rate,” said Jayant Sood, Chief Customer Experience Officer, at Snapdeal.
In an e-commerce war, Snapdeal has been facing tough competition from Amazon and Flipkart. It has recently decided to lay off 500-600 people in a cost-cutting measure. Its founders Kunal Bahl and Rohit Bansal have also taken 100% salary cut. Bahl said in a letter to Snapdeal employees that the company had expanded into doing too many things without getting the first things right.
Meanwhile, there have been rumours of a three-way merger with Alibaba (its investor) and Paytm, which is the country’s largest mobile wallet, and also had a marketplace.
-
FOREIGN FIRMS RUSH TO INDIA’S ONLINE MARKETPLACE
NEW DELHI (TIP): India’s booming online marketplace business has attracted a new wave of merchants and sellers from countries such as China, South Korea, Japan, Singapore and the US. In fact, thousands of sellers are getting into tie-ups with Indian e-commerce players to kick-start operations in the country.
According to industry insiders, around 50,000 sellers from China, South Korea and Singapore are planning to enter India through online marketplace players.
“In business-to-business (B2B) segment, there is no online organised player in the country right now. The market is being created for the online businesses,” said Sanjay Sethi, co-founder and CEO of Shopclues. The company has brought in DHgate, the second largest player in China after Alibaba, on to its platform. It’s also getting 25,000 South Korean merchants on board. Tie-ups are also in process with Singapore Traders Association to enable them to sell on Shopclues.
WINDS OF CHANGE
– Around 50,000 sellers from China, South Korea and Singapore want to enter India through online marketplace players
– American retail major Walmart is also exploring ways to tie up with leading e-commerce companies in India, including Flipkart, Snapdeal and others
– Metro Cash and Carry is also in talks with e-commerce marketplace players to sell its products online
– E-commerce giant Alibaba is looking to make a big bang entry into India’s marketplace via One97 Communications-owned PaytmAmerican retail major Walmart is also exploring ways to tie up with leading e-commerce companies in India, including Flipkart, Snapdeal, ShopClues, Grofers and Bigbasket. It is learnt that German wholesale giant Metro Cash and Carry is also in talks with e-commerce marketplace players to sell its products online.
Meanwhile, e-commerce giant Alibaba is looking to make a big bang entry into India’s marketplace via One97 Communications-owned Paytm.
Alibaba is expected to be the support behind Paytm’s China product portfolio. With that in place, Paytm will aim to become the biggest Indian player insofar as the number of sellers on the platform is concerned. With eight million sellers, Alibaba has the widest seller range as well as product portfolio.
This is not for the first time that Paytm is planning to sell Alibaba’s product range. During Diwali last year, Paytm had the whole product catalogue sourced from Alibaba and merchants from China were directly shipping products to customers in India, saving Paytm the hassle of finding warehouses.
As for the second top player in China, DHgate, online B2B would be a gateway into India and an opportunity to get connected to 350,000 sellers through the Shopclues portal.
DHgate plans to list its products across categories, including electronics, accessories, beauty products and sports. “From China we are getting around 10,000 SKUs (stock keeping units) listed. It is not a retail business and the target audience for this business are other businesses in India,” said Sethi.
The foreign investment rules vary across retail platforms and companies often resort to complex structuring to bypass policy. While foreign direct investment (FDI) is capped at 51 per cent in multi-brand retail with states having the last say on whether international players would be permitted to operate or not, there’s no limit of foreign investment in single-brand and business-to-business or cash and carry.
In e-commerce, however, FDI is not permitted. But, e-commerce players are mostly run with foreign money by operating marketplace platforms, where rules have not been framed yet.
-
Paytm invests $10 mn in logistics data start-up ‘LogiNext’
Logistics data start-up company LogiNext has got support from mobile commerce platform Paytm, which will invest $10 million in the first round of institutional funding for the firm.
The move is in line with Paytm’s plan to invest $150 million in Indian tech start-ups over the next few months.
Kiran Vasireddy, senior vice-president at Paytm, said while large logistics companies have tech capabilities, smaller ones have limited access to good technologies. “To solve this, we are building a strong logistics cloud network for our merchants and courier partners and our investment in Loginext adds muscle to our cloud offerings.”
Loginext’s big data analytics platform will help courier companies to bring more efficiency in their delivery network by route optimisation and real-time tracking of their resources.
LogiNext is a privately held big data analytics start-up backed by Indian Angel Network, one of the largest angel investing groups in India.