How Far Is Paytm
From Profitability?
Paytm has had a tough couple of years. While the RBI’s crackdown on its payments bank arm set the company back (on the revenue front) by a year, its mounting losses have been making retail investors jumpy. Amid the humdrum, the company claims to be on the path to turning profitable in the next two quarters.
So, is Paytm’s optimism well-founded?
The answer may not be as straight forward as the question itself. For starters, while Paytm’s aggressive cost-cutting exercise appears to have helped it trim indirect expenses, experts feel that the fintech giant is already overstretched and cannot afford to further reduce expenditures at the scale at which it operates.
Making matters worse is the rising tide of competitors, especially super apps, which preyed on Paytm’s lost market share post the RBI crackdown.
But, founder and CEO Vijay Shekhar Sharma still has a few aces up his sleeves. With a renewed focus on payments business, Paytm has lined up a three-pronged strategy – government’s UPI incentives, signing up more merchants and refurbishing inactive devices – to shore up its top line.
In addition, Paytm, which reported a loss of INR 208.5 Cr (down 6% YoY) and a revenue of INR 1,827 Cr (down 36% YoY) in Q3 FY25, is also stepping up focus on large-ticket consumer and merchant loans to further book profits and boost margins in the coming quarters.
Other sharp arrows in its quiver are its growing marketing wing for brands and merchants and the burgeoning wealth management business under the Paytm Money app.
While it is anybody’s guess if this multi-lever strategy will help the fintech major turn the tide in its favour, let’s understand how far Paytm really is from profitability. Continue reading…
From The Editor’s Desk
Unveiling India’s Fastest-Growing D2C Brands: The fourth edition of Inc42’s highly anticipated FAST42 list, which showcases India’s fastest-growing D2C brands, will be unveiled on March 19 at an exclusive event in Gurugram, bringing together the sharpest minds in the D2C space.
OYO’s FY25 Dream Run: Buoyed by the recent acquisition of US-based G6 Hospitality, the company is well placed to clock an EBITDA of INR 1,550 Cr in FY25, as per founder Ritesh Agarwal. Previously, OYO had projected a net profit of INR 1,100 Cr in FY26.
Scimplify Nets $40 Mn: The speciality chemical manufacturing startup has raised the capital as part of a Series B round co-led by Accel and Bertelsmann Investments. Founded in 2023, Scimplify specialises in end-to-end sourcing and manufacturing of speciality chemicals.
Deepinder Goyal Backs Spacetech Venture: The Zomato founder and CEO has invested $20 Mn in LAT Aerospace, which aims to build low-cost short distance aircrafts. The deeptech startup, founded by ex-Zomato COO Surobhi Das, has also appointed Goyal as a cofounder.
Binny Bansal Floats Opptra: The Flipkart cofounder has launched the AI-powered platform to help consumer brands scale faster across Asia via AI-driven localisation, digital first brand building, rapid fulfilment and robust data analytics.
Rapido To Enter Food Delivery: Senior executives at the ride-hailing platform are in discussion to figure out a business model to challenge the current commission structures of Zomato and Swiggy. Restaurants have protested against the foodtech majors in the past.
PB Fintech’s Healthtech Foray: The listed insurtech major has received approval from its board to invest INR 696 Cr in its newly floated healthtech arm. This follows the company announcing plans to pump $100 Mn in the vertical last year.
Now, Jio Inks Deal With SpaceX: Reliance’s digital arm has signed a pact to offer Starlink’s broadband internet services to its customers in India. The offering will be contingent on SpaceX receiving authorisation from Indian regulatory authorities.
Inc42 Startup Spotlight
How Octanom Is Pioneering ‘Hedged-Style’ Trading In India
While the concepts of hedging and structured products are popular in the US and other global markets, these offerings are still in their nascent stages in India. Realising there was no ‘hedged-style’ trading platform in India, Rahul Ghose founded Octanom in 2021.
The startup’s flagship ‘hedged-style’ trading platform, Hedged, leverages AI, machine learning and other complex derivative equations to suggest low-risk structured products to its users, helping them mitigate losses.
Besides, Hedged has built a “Nifty Crash Meter” or “Hedgeometer” that helps investors take necessary precautions and prevent losses by providing them with real-time index alerts and updates.
The startup currently claims to generate 80% of its revenue from institutional investors, including family offices and HNIs, while the remaining 20% comes from retail investors. It aims to touch the INR 10 Cr revenue mark by the end of FY25.
Octanom aims to soon launch an analysis platform for traders and brokers by July this year and is in the process of partnering with an AMC to roll out its structured products for retail investors via banks and brokerage platforms.
