Paytm Drops Bonus Share Plan, Q1 Profit Jumps 28% on Strong Growth

New Delhi: One 97 Communications Ltd, the parent company of mobile payments pioneer Paytm, said on Monday that its Board of Directors has decided not to proceed with a proposed issuance of bonus equity shares at this time, as the company continues to focus on further compounding growth and profitability for shareholder value creation.

The decision came alongside the company’s financial results for the quarter ended June 30, 2026. Paytm reported a profit after tax of Rs 220 crore and revenue from operations of Rs 2,448 crore, up 28 per cent year-on-year. The company also reported its highest EBITDA at Rs 203 crore, with margins expanding to 8 per cent, reflecting continued AI-led operating leverage.

“After evaluating the proposal from the perspective of long-term shareholder value and due deliberation, the board was of the view that the company should continue to focus on further compounding growth and profitability for shareholder value creation. Accordingly, the board decided not to proceed with the said proposal at this time,” Paytm said in a regulatory filing on Monday.

The decision reflects a conservative capital allocation approach at a time when the company is consolidating its profitability.

For Q1 FY27, Paytm merchant GMV growth accelerated to 31 per cent YoY to Rs 7.1 lakh crore, led by investments in product, distribution and service of device merchants and increasing momentum in the online merchant business following receipt of the online Payment Aggregator licence last year.

Distribution of financial services revenue grew 45 per cent YoY to Rs 814 crore, driven by continued growth in merchant loan distribution alongside tailwinds in consumer loans, and improved monetisation in equity broking and wealth products.

The merchant loan distribution business continued to benefit from the company’s growing merchant base, improving penetration, scale up of lending partners, as well as AI-led lifecycle management of device merchants. More than half of merchant loan disbursements came from repeat borrowers.

The company also continued to improve monetisation across equity broking, Margin Trade Funding and wealth products, including Paytm Gold, with AI-powered offerings expected to drive further growth.

Paytm Consumer UPI continued to gain market share for five consecutive quarters, with Consumer UPI GTV growing 45 per cent YoY to Rs 5.9 lakh crore, at 2.2 times the industry growth rate. Monthly Transacting Users increased by 60 lakh YoY to 8 crore. Continued AI-led product innovation helped improve engagement, retention and monetisation across the consumer business.

Retaining reserves gives the company headroom to invest in growth areas, including its expanding financial services distribution business, merchant subscription products, and international opportunities, without diluting balance sheet strength.

The decision comes as Paytm consolidates its position as a profitable, cash-generating business. With a strong balance sheet and consistent earnings momentum across merchant payments, financial services distribution and the consumer business, the company appears to be betting that disciplined execution will drive the next phase of shareholder returns.

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