Synopsis:
Shares fell after a major stakeholder might have offloaded a 5.84% stake via a block deal. However, the firm posted strong revenue growth, a turnaround to profit, and improved margins, with management confident about long-term growth potential and operating leverage.
The shares of the prominent digital solution provider plummeted up to 3 percent from its intraday high after Antfin, owned by the Alibaba Group, has likely sold 5.84 percent equity share in the company.
With a market capitalization of Rs 67,633.19 crore, the shares of One 97 Communications Ltd were trading at Rs 1,059.60 per share, decreasing around 1.73 percent as compared to the previous closing price of Rs 1,078.30 apiece.
The shares of One 97 Communications Ltd have seen bearish movement after Antfin, owned by the Alibaba Group, has likely sold a 5.84 percent equity stake in Paytm via block deals, quoting sources. The block size may be around Rs 3,803 crore. The floor price for the block deal was set at ₹1,020 per share. As of June 2025, Antfin (Netherlands) Holding BV holds 3,72,87,726 equity shares, which is equivalent to a 5.84% stake in Paytm.
The company delivered a strong turnaround in Q1FY26, with revenue rising 28% to ₹1,918 crore from ₹1,502 crore a year earlier. Notably, it swung from a net loss of ₹840 crore in Q1FY25 to a profit of ₹122 crore, showcasing improved operational efficiency and financial recovery.
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GMV growth is fueled by UPI expansion and a widening merchant base, with management projecting 4-5x growth potential ahead. While non-UPI GMV share is shrinking, RuPay credit cards on UPI and EMI services are driving meaningful revenue. Rising credit card acceptance and increased POS device market share further strengthen the company’s payments ecosystem.
The company reported a strong 60% contribution margin, up from 50% last year, with guidance in the high 50s. EBITDA margin stands at 4% in Q1, but management targets 15–20% in the next 2–3 years, expecting significant upside from operating leverage despite ESOP costs now being fully included.
The company faces cyclical headwinds in consumer credit and seasonal volatility in financial services due to regulatory factors. Despite this, management remains confident in profitability, leveraging product innovation and a full-stack approach. Conservative accounting and proactive device replacement policies are being implemented to strengthen capital efficiency and sustain long-term growth momentum.
One 97 Communications Limited owns and operates the brand Paytm. Paytm is a payment app offering consumers and merchants comprehensive payment services. Its segments include Payment, Commerce, Cloud, and others.
The Company is in the business of providing payment and financial services, which primarily include payment facilitator services, facilitation of consumer and merchant lending to consumers and merchants, and wealth management.
Written by Abhishek Singh
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