One 97 Communications Ltd , the parent company of Paytm, has reported a consolidated net profit of 21.00 crore rupees for the quarter ended September 30, marking a 98% decline from 928.00 crore rupees in the same period last year. The company's revenue from operations grew by 24% year-over-year to 2,061.00 crore rupees, driven by increased subscription merchants, higher payments GMV, and growth in financial services distribution.

Financial Highlights

Contribution Profit margin stood at 59%.

Key Business Metrics

Business Performance

One 97 Communications' growth was primarily driven by its payments and financial services segments. The company reported a 28% YoY increase in net payment revenue, while the financial services segment saw a 63% YoY growth, led by merchant loan distribution and enhanced collection performance.

Exceptional Items

The significant decline in profit was attributed to a one-time charge of 190.00 crore rupees for full impairment of a loan to joint venture First Games Technology. Without this charge, the profit would have been 211.00 crore rupees.

Corporate Updates

• The company appointed Ms. Manisha Raj Raisinghani as Non-Executive Independent Director for a five-year term, subject to shareholder approval.
• The board approved additional investment of up to INR 2,250 crores in wholly owned subsidiary Paytm Payments Services Limited (PPSL) through a rights issue. This investment aims to strengthen PPSL's net worth, fund acquisition of offline merchant payment business, support working capital needs, and maintain leadership in merchant payments business.
• Paytm granted 5,50,000 stock options under ESOP 2019 scheme.
• The company received a show cause notice from the Directorate of Enforcement regarding alleged FEMA contraventions worth approximately INR 611 crores, with some matters already resolved by RBI.

Future Outlook

One 97 Communications outlined four focus areas for future growth:

1. Expanding merchant leadership
2. Growing financial services distribution
3. Driving AI-first innovation
4. Evaluating new international markets as a long-term growth driver, expected to contribute meaningfully after 2-3 years

As the company continues to navigate challenges and pursue growth opportunities, investors and analysts will be watching closely to see if One 97 Communications can improve its profitability while maintaining revenue growth in the coming quarters.

One 97 Communications , the parent company of Paytm, has completed the acquisition of majority stakes in two of its subsidiaries, marking a significant step in simplifying its group structure. The company, in a regulatory filing, announced that it has acquired the remaining 51% stake in both Paytm Intelligence Limited and Paytm Life Insurance Limited.

Key Highlights of the Acquisition

• Paytm Intelligence Limited: One 97 Communications acquired a 51% stake from VSS Holdings Private Limited, which is wholly owned by Vijay Shekhar Sharma.
• Paytm Life Insurance Limited: The company purchased a 51% stake directly from Vijay Shekhar Sharma.

Implications of the Acquisition

This strategic move has transformed both entities into wholly-owned subsidiaries of One 97 Communications. The acquisition aligns with the company's previously announced plans to streamline its group structure, potentially leading to more efficient operations and clearer corporate governance.

Transaction Details

This restructuring may signal One 97 Communications' intent to consolidate its operations and potentially streamline decision-making processes across its various business verticals. As the fintech landscape continues to evolve, such strategic moves could position the company to respond more effectively to market changes and regulatory requirements.

Investors and market watchers will likely keep a close eye on how this consolidation impacts the company's operational efficiency and financial performance in the coming quarters.