🔍 At a glance
Paytm (One 97 Communications Ltd) went from “India’s Alibaba” to a 5-year fintech rollercoaster. After losing over ₹9,000 Cr in cumulative net losses, the company finally posted a single profitable quarter — and then reverted to red. With a stock price down from IPO highs, SEBI breathing down its neck, and RBI cracks in lending biz, is Paytm building a comeback arc — or just buying time with ESOPs and subsidiaries?
🏢 About the Company
- Founded: 2000 by Vijay Shekhar Sharma
- IPO: 2021, India’s biggest ever at ₹18,300 Cr
- Core Business Segments:
- Payment Services (wallet, UPI, QR, Soundbox)
- Financial Services (BNPL, insurance distribution, wealth)
- Commerce & Cloud (ticketing, marketing, advertising)
- Merchant Ecosystem: 4.2 Cr registered merchants
- Devices: 112 lakh payment devices live as of FY25
👨💼 Key Developments (FY21–FY25)
- 🚨 RBI Action on Lending (2024): Suspended Paytm Payments Bank onboarding
- 🔁 Merchant Lending Reshuffle: Partnered with NBFCs post-RBI crackdown
- 🎲 First Games under GST Lens: ₹5,712 Cr notice stayed by SC in May 2025
- 🌍 New Singapore Subsidiary (June 2025): SGD 250k invested
- 🧳 Top Management Continues: No major exits reported
- 🧑💻 ESOP Mania: Granted 23.7 lakh stock options @ ₹9 recently
🧮 5-Year Financials (Consolidated)
| FY | Revenue (₹ Cr) | Net Profit (₹ Cr) | EPS (₹) | OPM (%) | ROE (%) |
|---|---|---|---|---|---|
| FY21 | 2,801 | -1,701 | -280.42 | -66% | -21% |
| FY22 | 4,974 | -2,396 | -36.90 | -48% | -22% |
| FY23 | 7,990 | -1,776 | -28.02 | -21% | -12% |
| FY24 | 9,978 | -1,422 | -22.30 | -9% | -8% |
| FY25 | 6,900 | -663 | -10.33 | -22% | -10% |
📉 Revenue dropped in FY25 after 4 years of growth — largely due to RBI hit on Payments Bank
💸 Cumulative losses since IPO = ~₹9,000 Cr+
💹 Stock Performance
| Period | Performance |
|---|---|
| IPO Price (2021) | ₹2,150 💀 |
| CMP (June 2025) | ₹908 |
| 1-Year Return | +139% (post bottoming at ₹400) |
| 3-Year CAGR | ~18% |
🧠 Investors who held since IPO are still down 58% — but those who bought the dip? Up 2x.
💰 Forward Fair Value (FV) Estimate (Edu Model)
Assumptions:
- FY26 Expected Revenue = ₹9,500 Cr
- Net Margin Target = -2% to +2%
- P/S Range = 5x–6x (optimistic fintech base)
➡️ Forward FV = ₹700 – ₹1,100
CMP = ₹908 → Not grossly overvalued, but priced for a clean RBI sheet + monetization rebound
💸 Cash Flow Summary
| Year | CFO (₹ Cr) | CFI | CFF | Net Cash Flow |
|---|---|---|---|---|
| FY23 | 416 | 2,628 | -1,112 | 1,931 |
| FY24 | 651 | 338 | -22 | 967 |
| FY25 | -121 | -2,043 | -53 | -2,217 🔻 |
FY25 saw negative cash burn again — due to investment outflows + operating losses.
📊 Balance Sheet Snapshot
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Cap. | ₹63 Cr | ₹64 Cr | ₹64 Cr |
| Reserves | ₹12,952 Cr | ₹13,263 Cr | ₹14,963 Cr |
| Borrowings | ₹223 Cr | ₹177 Cr | ₹160 Cr |
| Investments | ₹2,697 Cr | ₹4,628 Cr | ₹4,172 Cr |
| Total Assets | ₹17,966 Cr | ₹17,139 Cr | ₹21,448 Cr |
✅ Strong balance sheet — no solvency issue
❌ But asset heavy due to non-core holdings and write-offs
🔍 Segment-Level Insight
1. Payments
- Core revenue driver
- Device base expanding (Soundbox penetration)
- Losing profitability due to MDR limits + regulatory heat
2. Financial Services
- BNPL / Lending Partner Disruption due to RBI
- Lending partnerships under scrutiny
- First Games facing ₹5,712 Cr GST litigation
3. Commerce & Cloud
- Ticketing, Ads, CRM
- Still minor contributor — not turning a meaningful profit
🚨 Red Flags
- ❌ Negative ROE 5 years in a row
- ❌ Net losses still not wiped
- ❌ Regulatory Risk: RBI + GST
- ❌ Employee ESOP dilution ongoing
- ❌ High valuation vs profitability
- ❌ Sales dipped 31% TTM
🤖 Peer Comparison
| Company | P/E | Market Cap (₹ Cr) | Revenue (₹ Cr) | ROE (%) |
|---|---|---|---|---|
| PB Fintech | 273.7 | ₹86,404 | ₹1,507 Cr | 5.9% |
| One 97 (Paytm) | NEG | ₹57,893 | ₹6,900 Cr | -10.3% |
| Infibeam | 28.4 | ₹6,332 | ₹1,160 Cr | 8.2% |
| Mobikwik | NEG | ₹2,148 | ₹266 Cr | -13.1% |
📉 Paytm still leads in scale, but bleeds on margins and trust
🧠 EduInvesting Take
“Paytm is like that startup founder in every meme — raised $2B, burnt ₹9,000 Cr, got slammed by the RBI, and is still shouting ‘super app’ while quietly applying for a Singapore visa. The stock’s up 2x from bottom, but so are investor questions.”
📦 TL;DR
- Revenue: ₹6,900 Cr in FY25, down from ₹9,978 Cr in FY24
- Losses continue: ₹663 Cr FY25 net loss
- CMP ₹908 vs FV range ₹700–₹1,100
- GST case + RBI action = real risks
- Device ecosystem strong, but business model still finding solid footing
Author: Prashant Marathe
Date: 12 June 2025
Tags: Paytm, One 97 Communications, Fintech India, RBI crackdown, GST penalty, Vijay Shekhar Sharma, IPO Recap, EduInvesting
