Key Points
- One97 Communications, Paytm’s parent company, has approved the sale of its stake in PayPay Corporation.
- The sale involves Paytm Singapore’s fully-owned subsidiary.
- The deal is still waiting for corporate approvals and other closing conditions.
- Once completed, the sale will increase Paytm’s total cash balance.
- Paytm’s stock rose more than 3%, reaching a 52-week high after the announcement.
- For Q2 2024, Paytm reported a profit of ₹930 crore, mainly due to a one-time exceptional gain.
Looma News
On December 6, 2024, Paytm’s parent company, One97 Communications, announced it has approved the sale of its stake in PayPay Corporation, a Japanese digital payments company. The approval was given by One97 Communications Singapore, a wholly-owned subsidiary of Paytm Singapore, during a board meeting held the same day. The deal includes transferring Stock Acquisition Rights (SARs) in PayPay.
The transaction still requires corporate approvals, the signing of transaction documents, and meeting typical closing conditions. Once the deal is done, Paytm Singapore expects it to increase its consolidated cash balance. Paytm also clarified that this sale is part of a potential $250 million deal with SoftBank Group, which is valued at about ₹2,000 crore.
Following the announcement, Paytm’s stock surged by over 3%, reaching a 52-week high of ₹990.90 on the BSE. Later, the stock settled at ₹975.80, reflecting a 2.02% increase. The company’s share price has climbed 8% this week and 24% over the last month.
Paytm’s Q2 Financial Results
For the quarter ending September 2024, Paytm’s parent company, One97 Communications, reported a profit after tax (PAT) of ₹930 crore, largely due to a one-time exceptional gain of ₹1,345 crore from the sale of its entertainment ticketing business. The company saw an 11% growth in revenue compared to the previous quarter, a 5% rise in Gross Merchandise Value (GMV), improved device revenue, and a 34% increase in financial services revenue.
