Friday, September 30, 2022
HomeBusinessVijay Shekhar Sharma re-appointed as Paytm MD & CEO for another five...

Vijay Shekhar Sharma re-appointed as Paytm MD & CEO for another five years

Paytm founder Vijay Shekhar Sharma received shareholder approval of parent company One97 Communications to continue as CEO and MD of the digital payments company for another five years.

The decision to reappoint Sharma at the helm of the company for a five-year term was moved Friday at the company’s 22nd Annual General Meeting (AGM). A total of 99.67% majority votes were registered for Sharma’s reappointment resolution, Paytm said in a scholarship application on Sunday.

In total, 94.48% majority votes were registered for the decision to approve the payment of Sharma’s compensation.

Recently, proxy consultancies such as Institutional Investor Advisory Services (IiAS), Stakeholders Empowerment Services (SES), and InGovern Research Services had opposed the “excessive” fee set for the position.

Sharma got nearly 46% of the ESOPs issued under Paytm’s 2019 ESOP scheme, which also came at a big discount to the company’s stock price.

Speaking at the fintech company’s 22nd Annual General Meeting (AGM) on Friday, Sharma said the company was in expansion mode until 2018-19 and entered monetization mode from 2019-20, according to participants who attended the meeting.

Sharma said Paytm, as the company has previously committed, will post operating profit in the quarter ending September 2023.

“Stock price movements are not influenced by us. There are several factors. The profitability of the company plays a very important factor in that. The growth of the company plays an important role in that, but these two are not the only factor for the stock price.

“Macro, micro, international investors and various other sentiments play a role in stock prices,” Sharma said.

See also  2023 Mahindra XUV300 Facelift Spied Revealing Design Updates

In response to questions from shareholders, he said management is making efforts to ensure the company records growth and makes strong profits for expanding the business.

Shareholders of One97 Communications Limited asked management about the path to profitability and the recovery of the share price to the IPO level of Rs 2,150. The stock closed at Rs 771 on Friday.

While most shareholders who were allowed to speak at the AGM expressed confidence in the company’s business model, some expressed dismay at One97 Communications’ losses and the fall in its share price.

A shareholder, Manjit Singh, said Paytm’s business model is good and the brand is visible, but the share price is well below the IPO level, which the company should be looking at.

Another shareholder, Bimal Kumar, inquired about the employee retention rate, the breakeven timeline and the company’s appraiser who set the share price at Rs 2,150.

Shareholder Santosh Kumar Saraf asked the company to increase the number of female employees at the company and settle old disputes related to 2013-14 while expressing confidence in the company’s business growth.

Shareholder Lokesh Gupta inquired about the reason for the loss when management took high salaries and asked the company to cut costs.

Other shareholders asked about the company’s expansion plans abroad and the status of the company’s margins.

Sharma said the company makes money on every transaction, in the range of 4 paise to 14 paise on every Rs 100 and in some cases like FASTag it goes up to Re 1.

See also  Key Test Today For Paytm's Vijay Shekhar Sharma After Dud IPO

“Wherever we installed the sound box, we get subscription fees. As the number of devices increases, the payments increase, then it leads to profits,” added Sharma.

He said that Paytm has about 3 crore merchants and the company believes there is a need to expand the services to more merchants, which will cost the marketing team.

“This outlay may look like a loss at the moment, but it will provide good returns in the long run,” he claimed.

Sharma also said the company will look to expand overseas after it gains positive cash flow in India.

Paytm President and Group CFO Madhur Deora said the company’s churn is between 2 and 2.5% per month.

Paytm has reported that the consolidated loss has increased to Rs 644.4 crore for the first quarter ended June 30, 2022. The company had recorded a net loss of Rs 380.2 crore a year ago.

The company said its contribution profit, excluding taxes and marketing costs, but including promotional incentives, more than tripled in the June 2022 quarter to Rs 726 crore from Rs 245 crore in the same period a year ago.

Consolidated operating income increased by 89% to Rs 1,680 crore during the reported quarter from Rs 891 crore earlier.

RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular

Recent Comments