One 97 Communications disclosed that the GST demand against its subsidiary, First Games Technology Private Limited (FGTPL), has been reduced to ₹703.66 crore from the previously proposed ₹5,712 crore. The company stated there is no incremental financial impact on its consolidated results.

The reduction follows a demand order issued by the Additional Commissioner of CGST Noida, Uttar Pradesh. This order pertains to a Show Cause Notice received by FGTPL in April 2025 regarding tax liabilities for the period from April 2018 to March 2023. FGTPL informed One 97 Communications of the new order on October 12, 2026.

Impact on Financial Statements

For group consolidation purposes, FGTPL is treated as a joint venture under applicable accounting standards. Consequently, its revenues are not consolidated in One 97 Communications' financial statements. The company’s share of profit or loss under the equity method was nil for the financial year ended March 31, 2026.

Furthermore, FGTPL discontinued its real-money gaming operations following the Promotion and Regulation of Online Gaming Act, 2025. Its financial statements for the year ended March 31, 2026, were prepared on a liquidation basis. The carrying value of the investment in FGTPL in the consolidated financial statements as on March 31, 2026, is already nil.

Regulatory Disclosure Details

The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. It references earlier disclosures dated May 27, 2026, concerning notices and the Supreme Court decision upholding 28% GST on online gaming companies.

FGTPL is currently evaluating the appropriate course forward in accordance with relevant statutory provisions. The demand includes a penalty equivalent to the tax liability along with applicable interest.

What the Numbers Show

The significant reduction in the proposed liability from ₹5,712 crore to ₹703.66 crore represents an 87% decrease in the assessed tax amount. However, this reduction does not alter the balance sheet position of One 97 Communications because the investment value in FGTPL was already written down to nil. The divergence between the substantial reduction in liability and the zero impact on the parent company highlights that the financial risk had been fully absorbed in prior periods through the equity method accounting and liquidation basis preparation.

One 97 Communications increased its shareholding in subsidiary Little Internet Private Limited (LIPL) to 77.42% following the completion of debenture conversions. The fintech major simultaneously invested ₹100 crore in its wholly owned subsidiary, Paytm Money Limited (PML).

The stake increase in LIPL resulted from the conversion of outstanding Optionally Convertible Debentures and Convertible Inter Corporate Deposits. This action raised One 97 Communications' ownership from 62.53% to 77.42%, consolidating control over the entity.

Separately, the company subscribed to a rights issue of equity shares in PML. This additional infusion of ₹100 crore reinforces capital adequacy within the stock broking arm, aligning with regulatory requirements for market intermediaries.

Subsidiary investment details

The disclosures were made under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The transactions follow earlier communications dated January 29, 2026, and July 20, 2026.

What the numbers show

The jump in LIPL ownership by nearly 15 percentage points indicates a strategic move to deepen integration with the underlying infrastructure or product layer housed within Little Internet. Concurrently, the ₹100 crore injection into Paytm Money suggests a targeted effort to strengthen the balance sheet of the brokerage arm, potentially to support trading volume growth or meet evolving SEBI net worth requirements for stock brokers.