2 min read.Updated: 30 May 2018, 11:37 AM ISTSalman S.H.
Paytm's loss figure for FY17 includes a one-time exceptional item of Rs591.3 crore, which takes its overall loss (before exceptional item) to Rs1,259.5 crore
Bengaluru: One97 Communications Ltd, the parent company of payments app Paytm, has reported total consolidated losses of Rs899.6 crore in the year ended 31 March 2017 (FY17), according to data sourced from business intelligence platform Paper.vc.
The loss figure for FY17, however, includes a one-time exceptional item of Rs591.3 crore, which takes its overall loss (before exceptional item) to Rs1,259.5 crore. This is slightly higher than the Rs1,177.6 crore loss (before exceptional item) reported in FY16.
Paytm had carved out its e-commerce business Paytm Mall into a separate holding named Paytm E-commerce Pvt Ltd. in August 2016. The newly filed consolidated financials do not reflect number from the e-commerce arm.
Paytm’s losses have increased despite steep cuts on promotions and ads. The company’s overall expenses went up by 17.6% from Rs1,775 crore in FY16 to Rs2,088.1 crore in FY17.
Most of Paytm’s expenses were on advertising and promotion for which it spent Rs969.4 crore in FY17. However, ads and promotional expenses reduced significantly by 39% in FY17 when compared to Rs1,346.8 crore in FY16.
Paytm also spent Rs333.7 crore on employee and staff related expenses in FY17. This includes gratuity payments, PF contribution, salaries, and other employee costs.
The company’s total revenue for FY17 stood at Rs828.6 crore which is a 38.6% increase against FY16 revenues of Rs597.8 crore.
The higher expenses also come at a time when Paytm has been stepping up investment activities. In December 2017, Paytm Payments Bank pledged to invest Rs3,000 crore for its offline banking initiative, which will accept deposits, withdrawals and taking in requests for new savings bank accounts.
In January, the company also launched a new investment arm named Paytm Money Ltd to offer investment and wealth management products. It pledged to invest close to $10 million upfront in the new entity.
“In the year ending March 2017, we invested over Rs. 2,000 crores to expand digital payments ecosystem for consumers in our country and enabling small merchants to accept payments digitally. We witnessed strong growth in our business in FY 2018, and made even larger investments particularly to bring digital payments to shopkeepers in the offline domain," said Madhur Deora, chief financial officer, Paytm in an emailed statement.
The company also launched two new insurance entities in February to offer standalone insurance products. It is in active talks with banks to offers financial products like insurance, loans and mutual funds to Paytm Payments Bank account holders.
Paytm’s owner One97 was valued at over $7 billion in May 2017 when the company raised $1.5 billion from SoftBank. The company currently has over 200 million registered users on its platform.
Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Never miss a story! Stay connected and informed with Mint.
our App Now!!