PB Fintech Achieves Adjusted EBITDA Profitability in Q4, Net Loss Narrows To INR 9 Cr

Insurtech platform Policybazaar’s parent entity PB Fintech on Monday (May 22) reported a consolidated net loss of INR 9 Cr in the March quarter of the financial year 2022-23 (Q4 FY23), which narrowed from INR 220 Cr in the corresponding quarter of the previous fiscal on the back of a strong growth across verticals.

Sequentially, the fintech company’s net loss narrowed from about INR 88 Cr in Q3 FY23.

PB Fintech’s operating revenue jumped 61% year-on-year (YoY) to INR 869.1 Cr in Q4 FY23. On a quarter-on-quarter (QoQ) basis, it rose over 42% from INR 610 Cr. 

After announcing that its lending vertical Paisabazaar achieved break-even on an adjusted EBITDA level in Q3, PB Fintech today said that in line with its estimates, the company broke even on a consolidated basis. It posted a consolidated adjusted EBITDA of INR 28 Cr in Q4 as against a loss of INR 80 Cr in the year-ago quarter. 

The company said it is hopeful of achieving net profitability in FY24. 

PB Fintech’s existing businesses, Policybazaar and Paisabazaar, together contributed INR 504 Cr to its total operating revenue, registering a 31% YoY growth. The business’ adjusted EBITDA stood at INR 64 Cr in Q4 FY23.

Meanwhile, the company’s new initiatives, which include insurance seller aggregator platform PB Partners and its UAE business, contributed INR 365 Cr to operating revenue, a jump of 136% YoY.  However, this business continued to be in the red, posting a loss of INR 36 Cr during the quarter under review. 

For FY23, PB Fintech’s operating revenue surged 79% YoY to INR 2,557 Cr, while its loss declined to INR 487.9 Cr from INR 832.9 Cr in FY22.

PB Fintech said that its overall business growth was driven by three factors – growth of renewal income, growth of new business, and higher efficiency on new business.

Besides, it said that March was an “exceptional” month for the industry given the tax changes announced in the Budget. These changes had a positive impact on the company’s savings business. 

The company said it continues to improve its premium per enquiry, which reached a record INR 1,754 in FY23. This was 27% higher than last year.

However, the decline in loss was not because of lowered expenses. PB Fintech’s total expenses rose over 18% YoY and 25% QoQ to INR 960.8 Cr in Q4 FY23.

It spent INR 391.2 Cr towards employee benefits, which increased from INR 374.3 Cr in the corresponding quarter of the previous year. It also rose 9.7% sequentially.

The fintech startup’s ESOP charges declined on a YoY as well as QoQ basis to INR 96 Cr in Q4 FY23. ESOP expenses stood at INR 542 Cr in FY23 as against INR 607 Cr in FY22.

Meanwhile, advertising and promotion expenses stood at INR 456.5 Cr in Q4 as against INR 360.7 Cr in Q4 FY22 and INR 298.5 Cr in the December quarter of FY23.

PB Fintech also spent INR 25.6 Cr towards network and internet expenses, which grew over 46% YoY.

Performance Of Core Businesses 

PB Fintech’s credit business Paisabazaar’s loan disbursal annual run rate (ARR) stood at over INR 15,000 Cr and card issuance ARR at 5.3 Lakh, as of March 2023. Loan disbursal grew 76% YoY while issuance of credit cards surged 185% YoY in FY23, the company said.

On the other hand, insurtech vertical Policybazaar’s insurance premium ARR stood at over INR 14,000 Cr, growing at 65% YoY in the year.

“Our renewal/trail revenue is at an ARR of INR 388 Cr+, up from INR 265 Cr last year in the same quarter. This typically operates at over 85% margins and is a significant source of profit growth,” said the company.

As of March 31, 2023, Policybazaar had 67.5 Mn registered consumers on its platform, including 14 Mn transacting consumers.

Paisabazaar’s total transacting customers at the end of the same period stood at 3.8 Mn, with 5.4 Mn transactions made on the platform till date.

The company said that co-created product strategy is shaping up well with six products including Step-up Card, Duet Credit Card, Credit-line products gaining good market traction.

Paisabazaar and RBL Bank launched co-created credit card ‘Duet’ in December 2022.

The company released its financial results after market hours. Shares of the company closed 1.7% lower at INR 619.05 on the BSE on Monday.