One97 Communications, the parent company of fintech giant Paytm, announced a robust financial performance for the first quarter ended June 30, 2026. The company's consolidated net profit soared by an impressive 79% year-on-year, reaching ₹220 crore, up from ₹123 crore in the corresponding period last year.
This significant profit growth was underpinned by a solid 28% increase in revenue from operations, which climbed to ₹2,448 crore for the April-June quarter, compared to ₹1,918 crore a year ago. Total income for the quarter also rose to ₹2,630 crore from ₹2,159 crore, reflecting broad-based expansion across key business segments. Profit before tax nearly doubled, reaching ₹247 crore from ₹126 crore previously.
Key Growth Drivers and Strategic Moves
Paytm attributed its improved financial health to sustained momentum in its core payments business, the expanding base of merchant subscriptions (particularly through its Soundbox devices), and the increasing contribution from its financial services distribution, including personal and merchant loans. The company noted robust merchant subscription growth as more businesses adopted its payment devices, alongside rising demand for credit products distributed via its platform.
In a separate development, Paytm's board approved an investment of up to ₹100 crore in its wholly-owned subsidiary, Paytm Money, through a rights issue. This capital infusion is earmarked for strengthening the platform's technology infrastructure, meeting regulatory capital requirements, and accelerating the expansion of its investment and wealth management offerings.
Furthermore, the board also cleared a proposal to seek shareholder approval for revising the utilization of the remaining ₹1,686 crore in unutilized IPO proceeds. The proposed extension of the utilization deadline to March 31, 2029, aims to provide greater flexibility for deploying funds across strategic growth initiatives and capitalizing on emerging business opportunities within its payments and financial services ecosystem.
Brokerage Outlook on Paytm Stock
Following the Q1 results, several prominent brokerages issued their assessments:
- Goldman Sachs assigned a 'Buy' call on Paytm, setting a target price of ₹1,500. The brokerage highlighted an acceleration in revenue growth during 1QFY27 and a meaningful beat on EBITDA, driven by market share gains in both offline and online payments and strong traction in merchant loan distribution.
- CITI also issued a 'Buy' rating, raising its target price to ₹1,560. CITI noted that Q1 EBITDA of ₹200 crore surpassed its estimates, attributing the beat to in-line revenue and contribution profits, largely due to lower indirect costs and higher loan distribution.
- CLSA maintained a target price of ₹1,050, acknowledging that the Q1FY27 EBITDA of ₹200 crore was marginally ahead of its own estimates.