Shareholding Dynamics Shift as Fintech Giant Navigates Regulatory Challenges
Fintech behemoth Paytm disclosed on Tuesday (April 9) that foreign portfolio investors (FPIs) significantly increased their shareholding in the company during the fourth quarter (Q4) of the financial year 2023-24 (FY24). According to a regulatory filing with the Bombay Stock Exchange (BSE), FPI inflow surged by 2.49% sequentially, with foreign investors acquiring an additional 15 million shares, totaling 131 million shares by the end of Q4 FY24.
Here are key statistics from Paytm’s Q4 FY24 shareholding pattern:
- FPI shareholding: Increased to 20.19% by end of March 2024.
- Domestic institutional investors’ stake: Rose to 6.86% in Q4 FY24.
- Mutual funds’ stake: Increased by 1.17% to reach 6.15% in Q4 FY24.
- Retail investors’ shareholding: Climbed by 0.79% to 6.86% by end of Q4 FY24.
- NRIs’ stake: Augmented to 0.85% in March 2024.
Simultaneously, the shareholding of domestic institutional investors witnessed a notable uptick, primarily driven by investments from Mirae and Nippon India mutual funds. Paytm revealed that mutual funds raised their stake by 1.17% from 4.99% in Q3 FY24 to 6.15% in Q4 FY24. Consequently, domestic institutional investors saw their stake rise by 0.79% quarter-on-quarter (QoQ), reaching 6.86% by the end of Q4 FY24.
Retail investors also displayed increased participation, with their shareholding climbing by 0.79% QoQ to 6.86% by the end of Q4 FY24. Furthermore, Non-Resident Indians (NRIs) augmented their stake in the fintech giant to 0.85% in March 2024 compared to 0.67% in December 2023.
However, a significant divergence was observed in Foreign Direct Investment (FDI) shareholding, which decreased to 60% in Q4 FY24 from 66% in the previous quarter. Paytm attributed this decline to SoftBank’s reduction of its stake by 5.06% between January and March 2024.
This revelation coincided with the announcement of Surinder Chawla’s departure as the CEO and MD of Paytm Payments Bank, effective June 26, further reflecting shifts within the company’s leadership.
The surge in FPI and domestic institutional investor stakes comes amidst regulatory challenges, including the Reserve Bank of India’s (RBI) directives barring Paytm Payments Bank from certain transactions, effective March 15. Paytm, yet to release its financial statements for the quarter ended March 2024, witnessed a 38% year-on-year (YoY) increase in revenue from operations to INR 2,850 crore in Q3 FY24, alongside a 43% YoY decline in net loss to INR 222 crore.
