After releasing solid operating results for the most recent quarter, One97 Communications, the business that owns Paytm, saw a sharp increase in Paytm share price on Wednesday.
When One 97 Communications, a fintech company that operates the payments platform Paytm, reported that its GMV increased 37% YoY in the June quarter while the average monthly transacting customers increased by 23% YoY, its shares of One 97 Communications surged 3% to Rs 861.9 on the BSE on Wednesday.
How much did Paytm share price rose in GMV in Q1?
Paytm stated in a quarterly business report that the total merchant GMV handled through its platform for the quarter ending June 2023 was Rs 4.05 lakh crore. It represented a YoY rise of Paytm share price NSE 37%. Gross merchandise value is referred to as GMV.
With average monthly transacting users of 9.2 crores for the quarter, up 23% YoY, Paytm observed steady growth in its user base.
What exactly Paytm stated about the growth?
With average monthly transacting users (MTU) of 9.2 crores for the quarter, up 23% YoY, Paytm share observed steady growth in its user base.
A YoY surge of 167% was seen in the loan distribution industry. It saw disbursements of Rs 14,845 crore.
In June, the MoM loan distribution trend reflects the higher disbursements in May. It included pent-up demand for merchant loans since April, when one of our partners failed to disburse due to an upgrade of their systems, said Paytm. They also said that the company is focusing on asset quality by proactively tightening credit policies wherever necessary.
The reason behind Paytm shares growth
It intends to add three to four partners in FY24 and presently has seven active loan partners. As of June 2023, there were 79 lakh merchants paying subscription fees for payment devices. It includes Soundbox and POS systems, a growth of 4 lakh devices in the month and 11 lakh devices in the quarter.
Strong device adoption fuels subscription revenues and larger payment volumes thanks to their subscription-as-a-service business model. It also widened the funnel for our merchant loan distribution, according to the statement.
Paytm shares have been doing well in 2023 after being underwhelming since their IPO in November 2021. The new-age stock has increased by 62% so far this year after posting EBITDA profitability in Q4 for the second consecutive quarter.
However, Macquarie has reduced the new-age stock to a neutral rating with a target price of Rs 800. Recently, global brokerage company BofA Securities boosted the target price to Rs 1,020 from Rs 885, citing progress in high-margin lending and the Soundbox sector.
The Paytm share price increased by around 1.42% to trade at $848.60 on Wednesday morning. Although the stock has risen by about 60% so far this year, it is still somewhat below its IPO price.
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