Paytm shares rally up to 4% on Q3 business update

New Delhi: Shares of One 97 Communications (Paytm) rallied up to 4% to day's high of Rs 574 in Monday’s early morning trade after the fintech reported a 357% year-on-year (YoY) rise in total value of loan disbursements in the December quarter to Rs 9,958 crore.

"The number of loans grew 117% YoY to 3.7 million for the month of December, and 137% YoY to 10.5 million cumulative loans for the three months ended December 2022," Paytm said in an exchange filing today. The average number of monthly transacting users or MTU came in at 85 million, registering a growth of 32% YoY.

The total merchant GMV processed through our platform for the quarter ended December 2022 aggregated to Rs 3.46 lakh crore, marking a YoY growth of 38%.

Paytm said that its focus over the past few quarters continues to be on payment volumes that generate profitability for the company, either through net payments margin or from direct upsell potential.

"Our loan distribution business (in partnership with top lenders) continues to witness an accelerated growth with disbursements through our platform stood at Rs 3,665 crore in the month of December, growing 330% YoY," it said.

With a focus on creating additional payment monetization beyond MDR, Paytm said that its focus on subscription services continues to expand. "Number of merchants paying subscription for payment devices has reached 5.8 million as of December 2022, an addition of 1 million devices in the quarter ended December 2022," it said.

In the meantime, Paytm Payments Bank has appointed Surinder Chawla as managing director and CEO. Chawla joins from RBL Bank, where – as head of branch banking - he had focused on expanding its current account, savings account (CASA) base, fee revenue and cross-selling across channels.

As compared to its IPO issue price of Rs 2,150, shares of the new-age company are still trading 73% lower. The stock was among the worst performers in the calendar year 2022.

The average target price of 11 analysts, eight of whom have buy ratings, signals an upside potential of around 66%, showed Trendlyne data.

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