Paytm losses swell 70% to ₹1,490 crore in 2017-18

New Delhi: One97 Communications Ltd, the parent company of mobile payments app Paytm, widened its net loss by 70% in the last financial year as higher expenses offset a surge in revenue, showed data from business intelligence platform Tofler. The company, backed by China’s Alibaba Group Holding Ltd, posted loss of 1,490.7 crore in the year ended 31 March, 2018. Paytm had a 879 crore loss in the previous year. The figures were sourced by Tofler from the Registrar of Companies.

Paytm did not report any major exceptional item last year, compared with 591.3 crore in the previous year. Total revenue climbed more than fourfold to 3,314 crore, from 780 crore in FY17.

Expenses more than doubled because of an increase in employee, information technology and advertisements costs. Paytm spent 4,718 crore on expenses during the year against 1,947 crore in FY17.

Advertising and promotions comprised bulk of the total expenses at 2,917 in FY18, up from 967 crore a year earlier.

Paytm also spent 540 crore toward employee expenses in FY18. It included gratuity payments, provident fund contribution and salary, among other costs.

Paytm has managed to retain investor attraction despite its mounting losses. It had raised $300 million from Warren Buffett’s Berkshire Hathaway Inc., Mint reported in August.

The company had carved out its e-commerce business Paytm Mall into a separate holding, named Paytm E-commerce Pvt. Ltd, in August 2016. The online retailer raised about ₹1,500 crore from Japan’s SoftBank Group Corp. and existing investor Alibaba, as part of a ₹3,000 crore funding commitment that was initially announced in April, Mint reported in June.

Paytm had in May said it plans to invest ₹5,000 crore over the next three years as it looks to enhance bank transfer and other payments facilities for customers through its platform. It has also launched a mobile-based payment facility in Japan called PayPay in partnership with SoftBank and Yahoo Japan.

In January, the digital payments company had launched a new investment arm, Paytm Money Ltd, to offer investment and wealth management products.

It also entered the mutual fund distribution business in April and plans to offer shares of listed companies directly to customers, Mint reported in September.

Founded by Vijay Shekhar Sharma in 2000, One97 Communications started out as a mobile payments and mobile recharge business.

It currently ranks among the top three consumer internet companies in India and has more than 300 million registered users on its platform.

In July, it had claimed to have breached $4 billion in monthly gross transaction value, including recharges, bill payments and peer-to-peer transactions.