Paytm’s Q4 Results Exceed Expectations, Revenue Up 52% to Rs 2,335 Crore

Paytm’s revenue increased by 52% to reach Rs 2,335 crore in Q4,, and its loss decreased from Rs 763 crore in the previous year to Rs 168 crore. The company’s payment services revenue grew by 41% YoY to Rs 1,467 crore, but if the government’s UPI incentive from prior quarters is excluded, the payment revenue grew 28% YoY.

According to the company’s statement, its payments segment profitability has shown significant improvement. The Q4FY23 net payment margin increased by 158 percent YoY to Rs 687 crore. Excluding the UPI incentive from previous quarters, the net payments margin was Rs 554 crore, which is up by 107 percent YoY. In FY23, the company’s net payments margin witnessed a growth of 2.9 times, reaching Rs 1,970 crore.

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In Q4 FY 2023, Paytm’s gross merchandise value (GMV) increased by 40 percent YoY, reaching Rs 3.62 lakh crore. The company is focused on creating additional payment monetization, and as of March 2023, 68 lakh merchants were paying for device subscriptions, almost doubling its growth YoY from 29 lakh in March 2022. Additionally, Paytm’s credit distribution business, in partnership with multiple lenders, has grown to 1.2 crore loans, which is an 82 percent YoY increase. Furthermore, the total value of loans amounted to Rs 12,554 crore, registering a growth of 253 percent YoY.

In Q4 FY 2023, Paytm witnessed a 40 percent YoY increase in its gross merchandise value (GMV), which stood at Rs 3.62 lakh crore. The company has been concentrating on developing further payment monetization and has achieved continued growth in subscription revenues. Around 68 lakh merchants had subscribed to Paytm’s device subscriptions as of March 2023. This has indicated a YoY growth of nearly 100 percent from 29 lakh in March 2022.

Paytm’s credit distribution business, in partnership with multiple lenders, has shown significant growth in the past year. The number of loans has increased by 82% YoY to 1.2 crore, with the total value of loans amounting to Rs 12,554 crore, a growth of 253% YoY.  Additionally, 95 lakh borrowers have taken a loan through the platform according to the data of March 2023,. For FY23, the total number of loans disbursed grew 163% YoY to 4 crore loans amounting to Rs 35,378 crore, surging 357% YoY.

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The driving factors behind the 55% contribution margin were the ongoing enhancement in payment profitability and the growing proportion of high-profit businesses, such as credit distribution. The contribution profit increased by 160% YoY to Rs 3,895 crore in FY23, rising from 30% to 49% of revenue. Excluding the UPI incentives from prior quarters, the like-for-like margin rose from 35% in Q4FY22 to 52%.

Additionally, Paytm’s user engagement continues to grow. It has raised with the average Monthly Transacting Users (MTU) for Q4FY23 by 27% YoY to 9 crore.

The company achieved operating profitability in Q3, ahead of its September 2024 guidance, due to improved monetisation, better cost management, and higher operating leverage. Moreover, the EBITDA before ESOP costs without UPI incentives elevated to Rs 101 crore in Q4.