In Q4FY23, Paytm reported EBITDA before ESOP cost of ₹234 Cr. Excluding prior quarters’ UPI incentives, EBITDA before ESOP at ₹101 Cr versus (₹368) Cr in Q4FY22
On full year basis, improves EBITDA before ESOP cost by ₹1,342 Cr
Contribution margin improved from 30% in FY22 to 49% in FY23, net payments margin increased 2.9X to ₹1,970 Cr in FY23 driven by continued improvement in payments profitability and increasing mix of high margin businesses
In Q4, reports revenue from Payment Services of ₹1,467 Cr, revenue from Financial Services of ₹475 Cr, and revenue from Commerce and Cloud of ₹392 Cr
One97 Communications Limited (OCL) that owns the brand Paytm, India’s leading payments and financial services company and the pioneer of QR and mobile payments, has announced Q4FY23 as well as the FY23 results. Paytm continues its sustained growth momentum in its core payments business with revenue from operations increasing 61% YoY to ₹7,990 Cr in FY23 and 51% YoY to ₹2,334 Cr in Q4FY23.
The company has further expanded its EBITDA before ESOP costs, including UPI incentive applicable for this quarter only, to ₹101 Cr versus ₹(368) Cr in Q4FY22. For FY23, EBITDA before ESOP cost stood ₹(176) Cr, a significant improvement of ₹1,342 Cr. Paytm achieved its operating profitability milestone in Q3FY23, much ahead of its September 2024 guidance.
The company’s revenue from Payment Services grew by 41% YoY to ₹1,467 Cr in Q4FY23. Excluding prior quarters’ UPI incentive, payments revenue grew 28% YoY. For FY23, led by increase in payment volume, and higher subscription revenue from device merchants, the payment revenue increased 44% to ₹4,928 Cr in FY23.
Paytm significantly increased its loan distribution business with Revenue from Financial Services and Others growing 183% YoY to ₹475 Cr in Q4 FY 2023 and by 252% in FY 2023 to ₹1,540 Cr. This was largely on account of 364% increase in the value of loans disbursed through our platform. The company continues to monetize Paytm app traffic in its Commerce and Cloud segment by providing marketing services to its merchants. In Q4 FY 2023, Paytm’s Commerce & Cloud revenue grew by 23% YoY to ₹392 Cr. In FY 2023, Commerce and Cloud revenue grew by 38% to ₹1,520 Cr.
The company further improved its payment profitability with Q4FY23 net payment margin expanding 158% YoY to ₹687 Cr while the net payments margin was ₹554 Cr, up 107% YoY after excluding previous quarters’ UPI incentive. In FY23, the company’s net payments margin grew 2.9X to ₹1,970 Cr, demonstrating profitability of payment business despite higher share of UPI.
Driven by continued improvement in payments profitability and increasing mix of high margin businesses like credit distribution, Paytm’s contribution margin in Q4 FY 2023 stood at 55%, improving from 35% in Q4 FY 2022. Contribution profit improved from 30% in FY22 to 49% in FY23 of revenue to ₹3,900 Cr, up 160% YoY. Excluding prior quarters’ UPI incentives, like-for-like margin increased to 52% from 35% in Q4FY22.
Paytm’s loan distribution business, in partnership with marquee lenders, continues to scale. In Q4FY23, total number of loans grew to 1.2 Cr (up 82% YoY) while the total value of loans amounted to ₹12,554 Cr, growth of 253% YoY, were disbursed through Paytm across its three product offerings — Paytm Postpaid, Personal Loans, and Merchant Loans. As of March 2023, 95 lakh borrowers have taken a loan through the platform. For FY23, total number of loans disbursed grew 163% YoY to 4 Cr loans amounting to ₹35,378 Cr, surging 357% YoY.
As adoption of digital payments for consumers and merchants in India continues, user engagement on the platform continues to grow with average Monthly Transacting Users (MTU) for Q4FY23 increasing by 27% YoY to 9.0 Cr. Paytm’s Gross Merchandise Value (GMV) increased 40% YoY at ₹3.62 Lakh Cr in Q4 FY 2023. With a focus on creating additional payment monetisation, the company’s subscription revenues continue to grow with 68 Lakh merchants paying for device subscriptions as of March 2023, more than doubling its growth YoY from 29 Lakh as of March 2022.
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