PB Fintech’s Q1 Net Loss Narrows 94% YoY To INR 11.9 Cr

Insurtech platform Policybazaar’s parent entity PB Fintech reported a 94% year-on-year (YoY) decline in its net loss to INR 11.9 Cr in the June quarter of the financial year 2023-24 (FY24) from INR 204 Cr in the year-ago quarter.

However, the net loss widened 28% on a quarter-on-quarter (QoQ) basis from INR 9.3 Cr, hurt by its new initiatives vertical.

Operating revenue surged 32% to INR 666 Cr during the quarter under review from INR 505 Cr a year ago.

In a statement, PB Fintech said that Q4 is traditionally the strongest quarter for the startup. However, its core online business revenue in Q1 FY24 was higher than in Q4 FY23, beating the traditional seasonality.

Policybazaar and Paisabazaar are jointly classified as PB Fintech’s core online business. The operating revenue of online business stood at INR 516 Cr in Q1 FY24 as against INR 504 Cr in Q4 FY23.

However, operating revenue declined 23.4% sequentially from INR 869.1 Cr.

The company turned adjusted EBITDA profitable in the March quarter of 2023. However, its adjusted EBITDA declined to INR 23 Cr in Q1 FY24 from INR 28 Cr in the preceding quarter. PB Fintech reported an adjusted EBITDA loss of INR 66 Cr in Q1 FY23.

Meanwhile, its core online business’ adjusted EBITDA in Q1 FY24 increased to INR 69 Cr from INR 64 Cr in Q4 FY23.

Policybazaar’s annual run rate (ARR) for insurance premium stood at INR 3,011 Cr in Q1 FY24, up from INR 2,430 Cr in the corresponding quarter of last fiscal.

Credit business Paisabazaar also continued to grow during the period, registering a 53% YoY growth in loan disbursal and a 47% YoY rise in credit card issuance in Q1 FY24.

Paisabazaar registered a loan disbursal ARR of over INR 16,000 Cr and card issuance ARR of about 5.8 Lakh, as of July 2023. The numbers stood at over INR 15,000 Cr and 5.3 Lakh, respectively, as of March 2023. 

PB Fintech said that more than 75% disbursals from the Paisabazaar platform are to existing customers.

The Sequential Degrowth

PB Fintech’s new initiative vertical, which includes insurance seller aggregator platform PB Partners and its UAE business, was the major reason behind the startup’s performance lag in the quarter.

Loss from the vertical widened to INR 46 Cr in Q1 FY24 from INR 36 Cr in the preceding March quarter. Operating revenue also declined to INR 149 Cr in the quarter under review from INR 365 Cr in Q4 FY23.

However, on a YoY basis, its top and bottom lines rose 11% and 34%, respectively.

PB Fintech also said that its UAE business grew 2.6X YoY.

The company said it’s increasingly moving the new initiative vertical towards smaller and higher quality advisors and it stays convinced about the future potential of the business.

PB Fintech’s numbers declined sequentially despite the company controlling its expenses. Total expenses fell 20% to INR 768.5 Cr in Q1 FY24 from INR 960.8 Cr in the March quarter of FY23. It spent INR 383.9 Cr towards employee benefit expenses, down from INR 391.2 Cr in Q4 FY23.

However, ESOP expenses grew to INR 100 Cr in Q1 from INR 96 Cr in the preceding quarter.

On a YoY basis, PB Fintech’s ESOP expenses fell from INR 168 Cr, while total employee benefit expenses rose marginally compared to last year’s quarter.

The fintech major managed to cut down its advertising and promotion expenses by 31.4% YoY and 56.4% QoQ to INR 198.8 Cr in Q1 FY24.

PB Fintech reiterated that it is confident of being “significantly” PAT positive for the year FY24.

Meanwhile, PB Fintech also announced investments in three of its subsidiaries during FY24 and FY25. It would infuse up to INR 700 Cr in Policybazaar Insurance Brokers Private Limited, INR 200 Cr in Paisabazaar Marketing and Consulting Private Limited, and INR 200 Cr in PB Fintech FZ-LLC.

Ahead of its results, PB Fintech’s shares ended today’s session 2% higher at INR 797.75 on the BSE.

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