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India's Paytm falls as net loss widens on higher expense

·1-min read
FILE PHOTO: The interface of Indian payments app Paytm is seen in front of its logo displayed in this illustration picture

NEW DELHI (Reuters) -Shares in India's One 97 Communications Ltd, the parent of Paytm, fell as much as 4.6% on Monday after the fintech company's net loss for its second quarter widened due to a rise in expenses.

In its first earnings report since going public earlier this month, the company said expenses jumped 37.1% to 15.99 billion rupees and consolidated net loss increased to 4.74 billion rupees ($63.31 million) from 4.37 billion rupees a year ago.

Its revenue from operations, however, surged 63.6% to 10.86 billion rupees for the quarter ended September.

"Some of the line items in our payment business are not just profit generating but free cash flow generating," founder and chief executive Vijay Shekhar Sharma said in an earnings call for investors on Saturday.

Paytm, which counts China's Ant Group and Japan's SoftBank Group among its backers, raised $2.5 billion this month in India's biggest initial public offering, but made a dismal debut on the stock exchanges.

While the stock has recouped some of the losses suffered during the debut, it still remained nearly 21% below its IPO offer price of 2,150 rupees.

"I'm looking to sell the shares as soon as the price goes up," said Bansidhar Bhatia from east Indian city of Kolkata, who bought Paytm shares at the issue price.

"I don't see long-term value in the stock and its price is very high compared to the company's business model."

As of 0430 GMT, Paytm shares were trading down 0.3% at 1,776 rupees.

($1 = 74.8660 Indian rupees)

(Reporting by Sankalp Phartiyal and Rama Venkat; Editing by Arun Koyyur)

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