India’s Paytm posts narrower Q/Q loss before special items on recovery in payments business

(Reuters) – India’s Paytm reported a narrower sequential quarterly loss before items on Tuesday, as its digital payments business recovers from the central bank’s dismantling of its banking unit earlier this year.

The company posted a loss of 4.07 billion rupees ($48.41 million) before items and taxes, smaller than the record loss of 8.39 billion rupees in the previous quarter but larger than 2.73 billion rupees a year earlier.

On a net basis, Paytm reported its first-ever profit since listing, with a consolidated net profit of Rs 9.28 billion ($110.38 million) in the second quarter ended September 30, supported by a one-time profit of 13, 45 billion rupees.

The company sold its event ticketing business to food delivery giant Zomato in a Rs 20.50-crore deal in August to focus on its dwindling payments and financial services business.

The company’s operating revenue fell 34% to Rs 1660 crore in the July-September quarter, recovering slightly from a 36% decline in the previous quarter as it absorbed the full impact of the resolution.

The Reserve Bank of India, also the country’s financial regulator, shut down Paytm Payments Bank in January due to ongoing compliance issues, sparking concerns about Paytm’s digital transactions and lending business and triggering a stock collapse.

However, Paytm had said in May that it expected a “significant” improvement in revenue and profitability from the second quarter.

($1 = 84.0720 Indian Rupees)

(Reporting by Dimpal Gulwani in Bengaluru; Editing by Janane Venkatraman)