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Paytm, leading payments and financial services company, on Friday said it has achieved operating profitability with <keyword id="63060" type="General" weightage="20" keywordseo="ebitda" source="Orion">EBITDA</keyword> before ESOP cost at Rs 31 crore, much ahead of its September 2023 guidance. Paytm's revenue from operations increased to Rs 2,062 crore (no <keyword id="6358921" type="General" weightage="50" keywordseo="upi" source="Orion">UPI</keyword> incentive recorded this quarter), a growth of 42 per cent YoY and 8 per cent QoQ. The growth was driven by increased adoption by consumers and subscription services by merchant partners along with sustained growth seen in loan distribution and commerce business, said the company. Paytm's founder and CEO <keyword id="914589" type="General" weightage="80" keywordseo="vijay-shekhar" source="Orion">Vijay Shekhar</keyword> <keyword id="445" type="General" weightage="20" keywordseo="sharma" source="Orion">Sharma</keyword> wrote a letter to shareholders announcing the achievement. "This has been made possible due to the relentlessly focused execution by our team. The team was asked to focus on growth with quality revenues that contribute to the bottom line. We have achieved this milestone without losing sight on growth opportunities and keeping all compliances as well as risk factors under a strict watch," he said. Contribution profit was Rs 1,048 crore in the quarter, with margins consistently improving from 31 per cent in December 2021 to 51 per cent in December 2022 on account of improved profitability of payments business and increased mix of high margin businesses such as loan distribution. Net payment margin grew to Rs 459 crore (up 120 per cent YoY) on back of improved profitability in the payments business. Paytm's EBITDA before ESOP margin stood at 2 per cent of revenues as compared to (27 per cent) a year ago, due to sustained improvement in contribution profit and strong operating leverage. The company said it continued to witness strong revenue momentum across its businesses. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/adani-enterprises-sbi-life-hdfc-life-among-stocks-in-focus/articleshow/97567830.cms">Sensex, Nifty50 close in the green powered by financial services and auto stocks</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/corporates/news/adanis-stock-rout-can-impact-its-ability-to-raise-capital-or-refinance-debt-says-moodys/articleshow/97582403.cms">Adani’s stock rout can impact its ability to raise capital or refinance debt, says Moody’s</a>

Paytm founder announces operating profitability, says free cash flow generation is next

<keyword id="6357120" type="General" weightage="100" keywordseo="paytm" source="Orion">Paytm</keyword> is expected to be adjusted EBITDA positive in March 2023, two quarters ahead of the estimates and the company's guidance of September 2023. It is learnt that global investment firm <keyword id="6361649" type="General" weightage="50" keywordseo="goldman-sachs" source="Orion">Goldman Sachs</keyword> expects October-December 2022 to be another strong quarter for Paytm, with revenue growth of 45 per cent on a yearly basis, adding that its margins print in the quarter would further increase the markets' confidence around the company's ability to be profitable in 2023. Notably, the Paytm Super App continued to see growing consumer engagement with the average Monthly Transacting User for the quarter that ended December 2022 at 85 million, registering a growth of 32 per cent on a yearly basis. "Paytm's MTU (monthly transacting users), loan disbursals and devices deployed continue to surprise us positively, and we have further raised our estimates for these metrics...," Goldman Sachs said. Thus, it reiterated 'Buy' rating with revised share target price of Rs 1,120 over a period of 12-month horizon. It is currently trading at Rs 541 per share. The global investment firm believes the current share price continues to offer a compelling entry point into what it termed Paytm as <keyword id="3658" type="General" weightage="20" keywordseo="india" source="Orion">India</keyword>'s largest and one of the fastest-growing fintech platforms. Meanwhile, the total merchant <keyword id="2185962" type="General" weightage="50" keywordseo="gross-merchandise-value" source="Orion">Gross Merchandise Value</keyword> processed through the Paytm platform for the quarter that ended December 2022 aggregated to Rs 3.46 lakh crore (USD 42 billion), marking a year-on-year growth of 38 per cent. The number of loans grew 117 per cent yearly to 3.7 million for the month of December, and 137 per cent to 10.5 million cumulative loans for the three months ended December 2022. As a result, total disbursements for the three months ended December 2022 was Rs 9,958 cr, a growth of 357 per cent on the year. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/over-1600-techies-being-fired-a-day-on-average-in-january-says-tracking-site-layoffs-fyi/articleshow/97047713.cms">Over 1,600 techies being fired a day on average in January says tracking site Layoffs.fyi</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/indian-ceos-see-a-difficult-year-but-most-say-they-wont-go-for-job-or-salary-cuts-pwc-survey/articleshow/97046963.cms">Indian CEOs see a difficult year but most say they won’t go for job or salary cuts: PwC survey</a>

Paytm may see profitability in March, two quarters ahead of expectation; Goldman Sachs raises target price

In a block deal, 3.4 per cent equity (or 2.1 crore shares) of <keyword id="6357120" type="General" weightage="100" keywordseo="paytm" source="Orion">Paytm</keyword>'s parent company One97 <keyword id="4584578" type="General" weightage="50" keywordseo="communications-ltd" source="Orion">Communications Ltd</keyword> (OCL) changed hands on Friday. Sources in the know of the development say that Chinese multinational Alibaba has sold its entire stake in Paytm in today's block deal. With this sale, Alibaba is no longer a stakeholder in Paytm. The company had sold around 3.1 per cent of 6.26 per cent equity in Paytm in January. This latest deal almost completes Alibaba's exit from <keyword id="3658" type="General" weightage="50" keywordseo="india" source="Orion">India</keyword> since it had earlier sold its stakes in <keyword id="830092" type="General" weightage="20" keywordseo="zomato" source="Orion">Zomato</keyword> and <keyword id="964794" type="General" weightage="20" keywordseo="bigbasket" source="Orion">BigBasket</keyword>. The news will bring cheer to the market as it ends the Chinese stakeholding in the homegrown Paytm. Paytm's shares have been rallying in the last few days since it announced operating profitability in its Q3FY23 results with EBITDA before ESOP cost at Rs 31 crore, significantly ahead of its guidance of September 2023. The fintech giant revenue from operations increased to Rs 2,062 crore (no <keyword id="6358921" type="General" weightage="50" keywordseo="upi" source="Orion">UPI</keyword> incentive recorded this quarter), a growth of 42 per cent on a yearly basis. This was followed by Paytm's robust operating update of January 2023 that it filed with the stock exchange on February 8. The company has continued to witness sustained growth momentum in its key payments and lending business. Paytm strengthened its leadership in offline payments with the deployment of 6.1 million devices while its average MTU at 89 million registered a 29 per cent growth for the month of January 2023. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/sports/news/what-is-formula-e-all-you-need-to-know-ahead-of-inaugural-race-in-india/articleshow/97795878.cms">What is Formula E? All you need to know ahead of inaugural race in India</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/rrr-kgf-chapter-2-game-of-thrones-spider-man-no-way-home-among-most-pirated-content-in-india-in-2022/articleshow/97795322.cms">RRR, KGF Chapter 2, Game of Thrones &amp; Spider-Man: No Way Home among most-pirated content in India in 2022</a>

Chinese multinational Alibaba exits India, sells its entire stake in Paytm

<ul><li>As the year of most IPOs in India comes to an end, another one kicks off.</li><li>The excitement for IPOs, particularly from retail investors, is likely to be a lot sober in 2022, says <keyword id="1038160" type="General" weightage="20" keywordseo="ajay-saraf" source="Orion">Ajay Saraf</keyword>, head of investment banking and institutional equities at ICICI Securities.</li><li>That would mean companies would be less confident in demanding high valuations, leaving more profit on the table for small investors in good companies.</li><li>Check out our <a href="https://www.businessinsider.in/bi-newsletter">weekly explainers</a> on the hottest topics and <a href="https://www.businessinsider.in/newsletters_signup.cms">sign up</a> if you like them</li></ul>The bull run in Indian equities that continued from mid-2020 up until late 2021 had drawn in hordes of companies, including the likes of <keyword id="830092" type="General" weightage="20" keywordseo="zomato" source="Orion">Zomato</keyword>, <keyword id="6376684" type="General" weightage="20" keywordseo="nykaa" source="Orion">Nykaa</keyword> and <keyword id="6357120" type="General" weightage="20" keywordseo="paytm" source="Orion">Paytm</keyword>, who wanted to make the best of the brimming optimism and get the best price for their shares. Millions of retail investors wanted a part of the boom in Asia’s best performing stock market, and a lot of IPOs benefited from the frenzy. That kind of unbridled enthusiasm is unlikely in 2022, according to Ajay Saraf, head of investment banking and institutional equities at ICICI Securities in an interview to Business Insider. Saraf is not alone. Srinivas Rao Ravuri, chief investment officer at PGIM India Mutual Fund also <a href="https://www.moneycontrol.com/news/business/markets/daily-voice-2022-would-be-a-challenging-year-for-investors-and-companies-planning-ipos-says-srinivas-rao-ravuri-of-pgim-india-mf-7856261.html">reportedly</a> believes that 2022 would be a challenging year for investors and companies planning IPOs. But that’s not entirely a bad thing. If the cautious mood makes good companies, who need to raise money, tone down the pricing it may leave more profit on the table for small investors. There were 63 initial public offerings (IPO) in 2021 and they raised a cumulative <a href="https://www.businessinsider.in/stock-market/news/list-of-upcoming-ipo-in-year-2022-in-india-ags-transact-adani-wilmar-prudent-corporate-advisory/slidelist/88492728.cms">₹1.18 lakh crore from investors</a> [hyperlink]. And, some of them doubled, or more, the <keyword id="1184176" type="General" weightage="20" keywordseo="ipo-investors" source="Orion">IPO investors</keyword>’ money on listing itself. <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Top performing IPOs of 2020 </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">% of listing gains </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Macrotech Developers </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">159% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Laxmi Organics </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">152% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Easy Trip Planners </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">151% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Barbeque Nation Hospitality </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">125% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Nureca </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">116% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">StoveKraft </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">115% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">MTAR Technologies </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">110% </td></tr><tr><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">Sona BLW Precision Forgings </td><td style="border-left:solid #000000 0.8333325pt;border-right:solid #000000 0.8333325pt;border-bottom:solid #000000 0.8333325pt;border-top:solid #000000 0.8333325pt;vertical-align:bottom;padding:2pt 2pt 2pt 2pt;overflow:hidden;overflow-wrap:break-word;">102% </td></tr></tbody></table> But, 2022 is likely to be different. “My sense is 2022 could be more volatile… and the issue would be stuff like hike in global interest rates, tapering, central bank prioritising inflation over growth and increasing interest rate earlier than expected, which might make the market volatile and IPOs may not be as smooth and great as 2021,” said Saraf. Here’s an <a href="https://www.businessinsider.in/stock-market/markets/news/heres-why-the-spike-in-inflation-in-the-us-may-worry-markets-in-india/articleshow/82597218.cms">explainer</a> on why the rising inflation, and the expected hike in interest rates, in the US may affect markets in India. If the market mood is uncertain, then the companies planning IPOs are likely to be less confident in seeking high valuations. Startups like <keyword id="143842" type="General" weightage="20" keywordseo="mobikwik" source="Orion">Mobikwik</keyword> are already waiting patiently before they launch the IPO to get the best price. Founder Upasana Taku told Business Insider that she is <a href="https://www.businessinsider.in/business/startups/news/mobikwik-founder-says-they-are-not-selling-any-shares-in-the-ipo/articleshow/88392998.cms">waiting for the market conditions to improve</a> even though she has the SEBI approval to launch the IPO. Legendary investor Warren Buffet has said in the past that he has never invested in an IPO. “The idea of saying the best place in the world where I can put money is something where all the selling, and their commissions are higher, the animal spirits are rising, that’s going to be better than a thousand other things I can where there is no similar selling enthusiasm, and the desire to get the deal done and earn some commissions. That’s the best thing to buy in a single day?,” Buffett <a href="https://www.cnbc.com/video/2019/05/06/warren-buffett-on-why-hes-never-bought-an-ipo.html">asked in an interview</a> in May 2019. In 2022, the animal spirits will be lower i.e. the emotional trigger for investments will be contained and therefore the valuations may be cheaper. “Valuation will become a bit more in favour of investors and that is the trend which we will see (next year),” said Saraf. If the IPOs are priced cheaper, it is likely that the headroom for profit is higher for investors, particularly for those who invest for the longer term. While this is general wisdom, it may so happen that the excitement may be lesser for some companies and higher for others. “Consumer tech and BFSI will lead the overall IPOs in terms of sector concentration in 2022,” said Saraf. Here’s a list of IPOs expected to open in 2022 <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Companies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Description </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">AGS Transact </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Payment solution providers </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Adani Wilmar </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Fast moving consumer goods </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Prudent Corporate Advisory </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Retail wealth management firm </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Emcure Pharmaceuticals </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Manufacture of pharma products in areas -- gynaecology, cardiology, blood- related, oncology, respiratory, CNS &amp; HIV </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Shri Bajrang Power &amp; Ispat </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Integrated steel manufacturer </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Sahajanand Medical Technologies </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Medical devices company </td></tr></tbody></table>Does lesser excitement for IPOs mean that loss-making startups have no hope in 2022? Saraf doesn’t think so. “I think Indian investors, given how the year 2021 was, they are willing to put money into companies who are still not breaking even or whose profitability may be few years away...and this trend will continue,” said Saraf. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/list-of-upcoming-ipo-in-year-2022-in-india-ags-transact-adani-wilmar-prudent-corporate-advisory/slidelist/88492728.cms">LIC, AGS Transact, Adani Wilmar and other IPOs coming up in early 2022</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/mobikwik-founder-says-they-are-not-selling-any-shares-in-the-ipo/articleshow/88392998.cms">Mobikwik founder says they are not selling any shares in the IPO</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/snapdeal-ipo-paper-reveals-that-it-is-going-offline/articleshow/88408081.cms">Snapdeal IPO papers reveal the e-tailer’s offline aspirations for budget fashion</a>

The IPO excitement may be softer in 2022 but that can be a good thing for investors

India's leading <keyword id="50691" type="General" weightage="80" keywordseo="digital" source="Orion">digital</keyword> payments and financial services company <keyword id="6357120" type="General" weightage="80" keywordseo="paytm" source="Orion">Paytm</keyword> will be a key beneficiary of India's Unified Payments Interface (<keyword id="6358921" type="General" weightage="100" keywordseo="upi" source="Orion">UPI</keyword>) incentive scheme, brokerage firm Morgan Stanley said on Thursday. The Union Cabinet on Wednesday approved the incentive scheme of Rs 26 billion for the promotion of RuPay Debit Cards and low-value BHIM-UPI transactions (P2M) for FY23, compared with Rs 15 billion in FY22. "Apart from banks, Paytm should be a key beneficiary of the above. On our estimates, Paytm would have received 5-7 per cent of the FY22 incentive, and assuming a similar share for FY23, this would represent 3-5 per cent of our contribution profit estimate (1 per cent higher than what we previously assumed for FY23)," the brokerage firm mentioned. One97 Communications's associate Paytm Payments Bank Ltd (PPBL) is the top beneficiary and leading remitter bank for UPI transactions. PPBL is an issuer and PSP Bank in itself along with being an acquirer of UPI transactions. Under the scheme, acquiring banks are provided with a financial incentives for promoting point-of-sale and e-commerce transactions using RuPay debit cards and BHIM-UPI transactions. <keyword id="198636" type="General" weightage="50" keywordseo="vijay-shekhar-sharma" source="Orion">Vijay Shekhar Sharma</keyword>, Founder, CEO &amp; MD of Paytm, tweeted: "Huge commitment by GOI Cabinet to push Digital Payments thru UPI and RuPay. The #DigitalIndia mission of our government will bring long-term benefits to our economy." During its last earnings call, Paytm's top management had said that the UPI merchant payments (which are free for the merchant) have become revenue-generating given the government is encouraging digital payments in the form of incentives for UPI P2M transactions. "UPI helps us with efficient customer and merchant acquisition and allows us to better monetise our platform by upselling financial services as well as payments devices," it said. This incentive scheme will facilitate the building of a robust digital payment ecosystem and promote RuPay Debit Card and BHIM-UPI digital transactions. In line with the objective of '<keyword id="2664548" type="General" weightage="50" keywordseo="sabka-saath" source="Orion">Sabka Saath</keyword>, Sabka Vikas', the scheme will also promote UPI Lite and UPI 123PAY as economical and user-friendly digital payments solutions and enable further deepening of digital payments in the country, across all sectors and segments of the population. The government also intends to continue the financial support for digital payments announced in the previous Budget, with a focus on promoting the use of payment platforms that are economical and user-friendly. The scheme has been formulated in compliance with the aforesaid Budget announcement, the Cabinet announcement included. The Paytm Super App continues to see growing consumer engagement with the average MTU for the quarter that ended December 2022 at 85 million, registering a growth of 32 per cent YoY. The total merchant GMV processed through the platform for the quarter ended December 2022 aggregated to Rs 3.46 lakh crore ($42 billion), marking a YoY growth of 38 per cent. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/sun-mobility-aims-to-serve-10-lakh-vehicles-through-its-battery-swapping-platform-by-2025/articleshow/96932578.cms">Sun Mobility aims to serve 10 lakh vehicles through its battery swapping platform by 2025</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/global-pc-demand-sees-its-deepest-collapse-since-mid-90s-amid-recession-fears-gartner/articleshow/96932794.cms">Global PC demand sees its deepest collapse since mid-90s amid recession fears: Gartner</a>

Paytm will be key beneficiary of India's UPI incentive scheme: Morgan Stanley

<ul><li>Paytm's stocks saw a sharp downside movement after a block deal that took place where 259,930 shares were sold.</li><li>Sources have confirmed that Chinese group Alibaba is behind the block deal.</li><li>According to sources, Alibaba seems to be making an exit from India as it had sold shares in other investments as well </li></ul> Paytm's stocks on Thursday saw a sharp downside movement after a block deal that took place where 259,930 shares were sold. The shares were sold at Rs 535.90 worth Rs 13.93 crore. Sources have confirmed that Chinese group Alibaba is behind the block deal, thereby selling about 3.1 per cent of its total equity of about 6 per cent. With this block deal, Alibaba, the sources said, seems to be making an exit from India as it had sold shares in other investments such as BigBasket and Zomato. This is expected to bring cheers among investors. With Chinese shareholding reducing their stake, it will benefit the company in their Foreign Direct Investment (FDI) aspect. Paytm shares' intraday low was Rs 528.10. In fact, immediately after the block deal it soon recovered some part of the losses. Paytm's shares had been steadily rising for the past few days after there were several good news floating about the company. Its associate <keyword id="3236791" type="General" weightage="80" keywordseo="paytm-payments-bank" source="Orion">Paytm Payments Bank</keyword> has received <keyword id="30067" type="General" weightage="80" keywordseo="rbi" source="Orion">RBI</keyword> approval to appoint <keyword id="5719896" type="General" weightage="80" keywordseo="surinder-chawla" source="Orion">Surinder Chawla</keyword> as its Managing Director and CEO. The company had posted a strong operating performance update for the October-December quarter. The Paytm Super App continued to see growing consumer engagement with the average Monthly Transacting User for the quarter that ended December 2022 at 85 million, registering a growth of 32 per cent on a yearly basis. The total merchant <keyword id="2185962" type="General" weightage="80" keywordseo="gross-merchandise-value" source="Orion">Gross Merchandise Value</keyword> processed through the platform for the quarter ended December 2022 aggregated to Rs 3.46 lakh crore (USD 42 billion), marking a year-on-year growth of 38 per cent. The number of loans grew 117 per cent yearly to 3.7 million for the month of December, and 137 per cent to 10.5 million cumulative loans for the three months ended December 2022. As a result, total disbursements for the three months ended December 2022 was Rs 9,958 crore, a growth of 357 per cent on year. Paytm believes it continues to be on track for its profitability plans, with robust revenue growth driven by its strong business model. Meanwhile, brokerage and global investment firm <keyword id="48670" type="General" weightage="80" keywordseo="morgan-stanley" source="Orion">Morgan Stanley</keyword>, in a report, pegged Paytm's shares target price to be at Rs 695 going ahead as against Rs 579 at Wednesday's close. It essentially means there is an upside potential of about 20 per cent returns on investment for investors. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/paytm-will-be-key-beneficiary-of-indias-upi-incentive-scheme-morgan-stanley/articleshow/96933995.cms">Paytm will be key beneficiary of India's UPI incentive scheme: Morgan Stanley</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/tcs-revenue-growth-to-slowdown-in-fy24-fitch-ratings/articleshow/96933754.cms">TCS revenue growth to slowdown in FY24: Fitch Ratings</a>

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