Paytm's payments revenue expected to be at USD 140 mn in Mar quarter, growing 50-60 pc y-o-y: Sharma

Digital financial services firm Paytm's revenue from payments, including merchant transfers, is expected to be at around USD 140 million (about Rs 1,034 crore) in the current quarter with a growth of 50-60 per cent on a year-on-year basis, a top official of the company said on Wednesday.

At the IAMAI India Digital Summit, Paytm founder and CEO Vijay Shekhar Sharma said the company is building credit as the next line of business and it has crossed the number of loans issued by one of the leading non-banking financial companies (NBFCs).

''We are a payment company and payment has a derivative revenue line item in financial services driven by credit. The success of Paytm will be what we do with the monetisation led by financial services because payment is a revenue line item, which is growing and massively growing.

''This quarter, we are talking about USD 100 million (Rs 739 crore) revenue from payments, which is a sizable revenue. That's quarterly and only for payments,'' Sharma said.

He said that the contribution margin from the payments business is around 10 per cent.

''If you add merchant services to it (revenue), that becomes USD 140 million and margins grow 30-40 per cent. People underestimate the size of payments revenue,'' Sharma said while responding to a query about concerns on a company's path to profitability.

Paytm's share price on Wednesday dipped to an all-time low of Rs 1,075 apiece and closed at Rs 1,083.4 a unit, down by 3.22 per cent compared to the previous close at the BSE.

Sharma shared a chart of global peers of the company which showed that their share prices have dipped in the range of 38-51 per cent in the past six months while Paytm's share prices have declined by about 26 per cent.

''South American companies are over 70 per cent down,'' Sharma said.

He said Paytm is now issuing more loans than Bajaj Finance in less than three years with an average ticket size of Rs 4,000.

''We not only make a contribution profit into this line item. The partners are so happy that more and more numbers of partners are in the queue today than ever before,'' Sharma said.

Paytm earlier this week posted over a four-fold jump in loan disbursals from its platform both in terms of numbers and value in the quarter ended December 31, 2021.

The company in a regulatory filing disclosed to have disbursed 44 lakh loans worth Rs 2,180 crore during the reported quarter, which was more than four times compared with 8.81 lakh loans worth Rs 470 crore disbursed from its platform a year ago.

The company's gross merchandise value (GMV) more than doubled to Rs 2.5 lakh crore during the October-December 2021 period compared with Rs 1.12 lakh crore it registered in the corresponding quarter a year ago.

''Our monthly transacting users (MTUs) showed consistent growth in FY 2021 and in the first two quarters of FY 2022.

''The trajectory has continued in the third quarter of FY 2022 with 64.4 million average MTUs, growth of 37 per cent y-o-y over the 47.1 million average MTUs in the third quarter of FY 2021,'' Paytm said in the filing.

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