PAYTM SLUMPS 4% AS PRESIDENT & COO BHAVESH GUPTA RESIGNS; Q4 RESULTS EYED
Shares of Paytm fell over 4.5 percent on May 6 after the digital payments and financial services firm announced the resignation of its COO and president, Bhavesh Gupta, via a regulatory filing over the weekend.
According to the filing, Gupta in a letter said that his resignation would be effective as of the close of business hours on May 31, 2024. He, however, expressed his intention to continue supporting the company in an advisory capacity within the chief executive's office.
In his resignation letter, Gupta cited personal reasons for taking a career break and expressed confidence in Paytm's future trajectory, acknowledging the robust leadership in payments and financial services developed over recent years.
“His resignation has been accepted by the Company and he will be relieved from the services of the Company w.e.f. close of business hours on May 31, 2024," Paytm said in the filing.
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Meanwhile, Paytm has also announced the appointment of Rakesh Singh as the new CEO of Paytm Money, while Varun Sridhar, the existing CEO, has been appointed as the Chief Executive Officer of Paytm Services Private Limited (PSPL).
Both Paytm Money and PSPL are subsidiaries of Paytm parent One97 Communications, and facilitate stock broking, investments in mutual funds, and other wealth management products for Paytm customers.
Bhavesh Gupta's resignation comes just ahead of Paytm's scheduled announcement of the March quarter results for fiscal year 2024. It is widely anticipated that the quarterly results may have been impacted following regulatory restrictions imposed by the Reserve Bank of India (RBI) on its associate firm, Paytm Payments Bank Ltd (PPBL).
In the quarter gone by, Paytm exhibited strong revenue growth on the back of distributing loans on its platform, which was also a high-margin business. The lending platform's commission contributed around 20 percent to the company's revenue and around 25 percent to its margin.
However, after the RBI ban on PPBL, the company has paused lending activities for more than a month. This is likely to have impacted the company's topline and bottom line more than it predicted in an investor conference call.
Also Read | Paytm President and COO Bhavesh Gupta resigns, Rakesh Singh appointed new CEO of Paytm Money
At 9:38 am, Paytm shares were trading 3.8 percent lower at Rs 355.25 on the National Stock Exchange (NSE). The stock has plunged 45 percent so far this year, massively underperforming benchmark Nifty which has risen nearly 4 percent during this period.
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2024-05-06T04:32:31Z dg43tfdfdgfd