Paytm registers bumper operating revenue uptick of 38% YoY, PAT improves by Rs 170cr YoY

New Delhi: India’s leading payments and financial services company Paytm has shown yet another impressive quarterly growth, registering a bumper operating revenue uptick of 38 per cent YoY, taking the revenue to Rs 2,850 crore in Q3FY24.

The PAT improved by Rs 170 crore YoY for the company, standing at (Rs 222 crore) due to growth and operating profitability.

Paytm’s EBITDA before ESOP stood at Rs 219 crore in the quarter of December 2023, compared to Rs 153 Cr in Q2FY24 (excluding UPI incentives). The fintech giant crossed 14 lakh devices in this quarter, the company stated in its earnings release.

Paytm's payments revenue experienced a substantial 45 per cent YoY growth, reaching Rs 1730 crore. Furthermore, the profitability of their payments segment demonstrated a significant improvement, as the net payment margin expanded by an impressive 63 per cent YoY to Rs 748 crore. The revenue from financial services and others also increased 36 crore YoY to Rs 607 crore in Q3FY24.

This was achieved by increase in GMV, merchant subscription revenues, and growth of loans registered on the platform. Resting on the back of its strong merchant leadership in in-store payments, Paytm now has 1 crore merchants onboard with them.

Furthermore, Paytm’s Average Monthly Transacting Users (MTU) for Q3 FY 2024 stood at 10 crore as adoption of mobile payments for consumers in India continues.

This complements the robust growth for its pioneering devices like Paytm Sound Box and Paytm Card machines. Contribution profit increased 45 per cent YoY to Rs 1,520 Cr, due to growth in net payment margin and financial services business.

Within its Marketing Services segment (formerly Cloud and Commerce), the company continues to capitalise on the monetisation of Paytm app traffic. This segment encompasses various services such as ticketing (covering travel, movies, events, etc.), advertising, credit card marketing, and deals and gift vouchers. Notably, in Q3FY24, the Marketing Services revenue experienced a 22 per cent year-over-year growth, reaching Rs 514 Cr.

As a merchant payments leader, Paytm continues to see sustained traction on merchant loans. The value of loans distributed by the company stood to Rs 15,535 crore due to improved takerate, up by 56 per cent YoY. It has also distributed Rs 490 crore of high-ticket loans in the December quarter.

In the Payments vertical, the company's multi-device-led approach will solidify its dominance in the acquiring space. Additionally, it intends to prioritise emerging use cases such as credit on UPI and Autopay to generate incremental and monetisable customer acquisitions.

Transitioning to Marketing Services, Paytm is providing merchants with deal, gift voucher, and loyalty services, as well as enabling e-commerce functionalities.

Paytm is also facilitating advertising on its app for various brands and businesses.

In the financial services sector, the company is expanding its high-ticket loan offerings by onboarding new lending partners. It is also scaling up embedded insurance, merchant insurance, and cross-selling equity trading services to the Paytm consumer base.

Paytm is also using AI led efficiency to drive operating leverage alongside creating optimised workflows. They expect significant operating leverage from employee costs given the technology and its increasing use case. This is reflected in their recent Rs 100 crore investment in development of an international innovation hub for financial services, fintech and entrepreneurship in GIFT city being made in the state of Gujarat.

The company’s board has also approved its joint development agreement with ACE builders to set up a campus in Noida in its pre-allotted land, which will require no expenditure from Paytm.