Backed by Chinese group Ant and Japanese SoftBank Group Corp (9984.T), Paytm raised $2.5 billion in India’s biggest initial public offering (IPO) last November, but made dismal start due to widespread concerns about its lofty valuation.
Its shares, which have fallen more than 70% since its IPO price of 2,150 rupees, rose 4.3% on Wednesday to hit a nearly three-week high of 635.4 rupees after the news.
“We are encouraged by our business momentum, monetization scale and operating leverage,” founder Vijay Shekhar Sharma said in a letter to shareholders.
“We expect that to continue, and I think we should break even in operating earnings before interest, taxes, depreciation and amortization (EBITDA) over the next six quarters.”
Sharma said his equity awards would vest only when the company’s market capitalization crosses the IPO level on a sustainable basis.
Shares of Paytm also suffered after the central bank last month banned its payments bank from adding customers and ordered a full audit of its IT systems, citing “hardware” oversight issues.
The company last month denied a Bloomberg News report that the Reserve Bank of India discovered that Paytm Payments Bank servers were sharing information with China-based entities that indirectly hold a stake in the company.
On Wednesday, the company also said the number of monthly users transacting on its app was at its highest level in the quarter with year-on-year growth of 41% to 70.9 million.
It disbursed 6.5 million loans during the quarter, for a total value of $470 million.