Retail investors' shareholding in Paytm doubles, MFs buy more shares

Canada Pension Plan increases stake in digital payments company, as some other foreign funds leave.

Retail investors' shareholding in Paytm doubled in the March quarter to 7.72 per cent, compared to 3.49 per cent in the quarter before, according to exchange filings by the digital payments company.

Paytm’s shares closed at Rs 641 on the BSE on Thursday, down 70 per cent from its IPO price of Rs 2,150 in November last year.

The company’s filings show that anchor investor Canada Pension Plan Investment Board (CPPIB) increased its stake from 1.57 per cent to 1.71 per cent. Some foreign investors left the company’s cap table though, with FPIs shareholding decreasing from 9.36 per cent in the December quarter to 4.42 per cent in the March quarter. According to reports, the total FPI selling in Indian markets was $14.5 billion in the March quarter.

While the company has released the shareholding for Q4FY22, reports show that even in April, top mutual fund houses and asset management companies (AMC) in the country bought new shares of Paytm parent company One97 Communications Limited (OCL).

According to a monthly mutual fund report by IDBI Capital, top 10 mutual fund investment companies have bought shares of OCL as part of their ‘Top 10 New Additions’ for the month. The companies are SBI Mutual Fund, ICICI Prudential Mutual Fund, LIC Mutual Fund, IDBI Mutual, IDFC Mutual Fund, DSP BlackRock Mutual Fund, Edelweiss Mutual Fund, L&T Mutual Fund, Nippon India Mutual Fund, and UTI Mutual Fund. The development comes as the company was recently included in the Nifty Next 50 Index.

Paytm founder and CEO Vijay Shekhar Sharma, earlier this month, said the company will achieve operating EBITDA (earnings before interest, taxes, depreciation, and amortisation) breakeven in the next six quarters. He also said that his stock grants in the company will vest only after the stock crosses its IPO price in a sustainable manner.

The company’s stock has been in a free fall at a time when technology companies’ stock prices have been pummeled the world over. However, Paytm has also faced the ire of analysts who have questioned its earnings from loan disbursals and thinly-spread out business model across cloud services, gaming and e-commerce, among other things.

In the December quarter, Paytm saw its revenue increase 89 per cent to Rs 1,456 crore on a year-on-year basis, whereas net loss widened 45 per cent to Rs 778 crore.

The company, which is yet to post its Q4 financial update, earlier said that its lending business scaled to 6.5 million loan disbursals during the quarter (Y-o-Y growth of 374 per cent), while the total loan value aggregated to Rs 3,553 crore (Y-o-Y growth of 417 per cent).

The company’s GMV saw 104 per cent Y-o-Y growth at INR Rs 2.59 lakh crore ($34.5 billion) and 41 per cent growth in MTU to 70.9 million users. The company maintains its lead in the offline payments business as the number of devices deployed grew to 2.9 million.