Paytm posed question on profitability again as losses widen, Brokerages sound caution

Recent listing Paytm released it's first ever public earnings and found itself answering the same question since it's debut debacle - When will the company turn profitable?

Paytm reported that losses widened in the July-September period to Rs 474 cr as as the newly-listed company struggled to make money off transactions which slowed during the pandemic. Revenue rose more than 60% in the same period, boosted by growth in financial, commerce and cloud services.

According to founder and chief executive Vijay Shekhar Sharma, the company’s business isn’t immediately set in stone, and some line items are “not just profit generating, but free cash flow generating.”

Brokerages also sounding caution against the fintech with Macquarie reiterating UNDERPERFORM on the stock with a price target of 1200 (40% below issue price) and JM Financial also initiating a SELL on the stock with a price target of Rs 1245/share.