Paytm Concludes Its Buyback Plan, Repurchases 1.55 Cr Shares At INR 850 Cr

Paytm’s parent entity One 97 Communications has bought back shares worth INR 849.83 Cr at an average price of INR 545.93 per share, the company said in its filings on Tuesday (February 14).

The fintech major has bought back a total of 1.55 Cr equity shares, which represents 99.98% of the maximum buy-back size, in the price range of INR 702.65 to INR 480.25 apiece.

“The Buy-back Committee, duly authorised by Board of Directors of the Company, at its meeting held on February 13, 2023, pursuant to the terms of the public announcement, has approved completion and closure of the Buy-back on and with effect from February 13, 2023, i.e., before the expiry of six months from the commencement date,” Paytm said in its exchange filing.

On December 13 last year, Paytm’s board approved the company’s proposal to initiate a share buyback of up to INR 850 Cr from the open market, representing 6.67% of the total paid-up share capital as of March 31, 2022.

During Paytm’s share buyback period, Alibaba.Com Singapore E-Commerce Private Limited exited the company by selling its total stake of 6.26%, or 4 Cr shares, in two tranches.

In January, Alibaba sold nearly 2.96% direct stake in Paytm through a bulk deal, and, last week, the Chinese ecommerce giant sold the rest of its 3.31% stake in a block deal worth INR 1,377.5 Cr.

Alibaba-backed Antfin Netherlands Holding held 16.1 Cr shares, or 24.86% stake, in Paytm, as of December 2022.

Amid the offloading of shares, Ant Group’s senior vice-president Douglas Feagin stepped down as a non-executive, non-independent director of Paytm earlier this month.

Shares of Paytm were trading 0.9% down at INR 637 on the BSE at 1.30 PM IST on Wednesday.

It must be noted that the company’s share buyback plan had earlier raised questions on whether its intention was to compensate its major institutional investors after its shares nosedived within a year after its IPO. Advisory firm Institutional Investor Advisory Services (IiAS ) publicly questioned Paytm on how it can manage with less cash after the buyback.

Earlier this month, Paytm reported a narrowed net loss of INR 392.1 Cr in Q3 FY23, compared to INR 778.5 Cr in the corresponding quarter of the last fiscal. The fintech major also claimed to have achieved its target of EBITDA positivity, before ESOP cost, three quarters ahead of its earlier estimate.

Paytm’s operating revenue was up over 41% year-on-year (YoY) at INR 2,062 Cr in Q3.

Meanwhile, Paytm’s leading business is gaining more strength with time. The company recently announced that it disbursed 38.65 Lakh loans worth INR 3,928 Cr in January 2023, up 103% and 327% YoY, respectively.