Softbank exited Paytm at a loss of $150 million in the June quarter.

(VOR News) – Approximately $150 million was lost by Paytm because Softbank Vision Fund, the Japanese investment arm of Softbank, withdrew from the company during the quarter ending in June.

It was during the year 2017 that Softbank made a number of investments in One97 Communications, the firm that is the owner of the Paytm brand. These investments total approximately $1.5 billion.

Paytm has lost between 10 and 12 percent, according to Softbank.

It has been reported that the overall amount of losses amounts to around $150 million, as stated in these reports.

Around 18.5% of Paytm’s shares were owned by Softbank before the company’s first public offering (IPO) in the year 2021. A 17.3 percent share was held by the company through SVF India Holdings (Cayman) Ltd., while a 1.2 percent interest was held by the company through SVF Panther (Cayman) Ltd.

The whole share that SVF Panther held was sold during the initial public offering (IPO) for a total of Rs 1,689 crore, which is approximately equivalent to $225 million.

The announcement that Softbank will withdraw from Paytm within twenty-four months of the company’s initial public offering (IPO) has been made recently. It was in accordance with the plan that Softbank had that this exit would take place. Furthermore, according to a different source, the firm did anticipate a loss at that time, despite the fact that this was the case.

Softbank had paid an average price of around Rs 800 per share for the majority of the Paytm shares that it had acquired.

Paytm’s share price was listed at Rs 1,955, which is a fall of 9 percent, and it has not yet achieved the same level as its initial offering price of Rs 2,150 per share.

Paytm hasn’t reached the price it was initially offered at.

As a result of the decision made by the Reserve Bank of India (RBI) to restrict its associate firm, Paytm Payments Bank Ltd (PPBL), from engaging in financial operations, the share price of Paytm saw an additional significant decrease. At a price of Rs 310 on May 9, it reached a new all-time low, which was a new record.

Paytm made the announcement that its losses had climbed to a total of Rs 550 crore during the fourth quarter of 2023-24. This was in response to the enforcement of a limitation on transactions that were affiliated with its payments bank.

The company wrote down an investment of Rs 227 crore for a 39 percent stake in PPBL during the quarter that was reported. This was done because of the future risks that are linked with the manner in which the company conducts its commercial operations. These risks included, among other things, the unpredictability of any further regulatory development that might occur.

The company’s loss for the fiscal year that ended on March 31, 2024 was lowered to Rs 1,422.4 crore. This amount represents a decrease from the previous year’s deficit. It was determined that Paytm has suffered a loss of 1,776.5 crore during the 23rd fiscal year (FY23).

Additionally, Berkshire Hathaway Inc., which is owned by the billionaire Warren Buffet, sold its shares in Paytm at a price that was lower than the one at which it had acquired them around seven months before to the sale.

The acquisition of a 2.6% stake in Paytm by the corporation was reportedly completed at a price of Rs 1,279.7 per share, which resulted in an aggregate value of Rs 2,179 crore, as stated in an official document.

As a result of the sale of the shares during the month of November at an average price of Rs 877.29 per share, the total value of the transaction was raised to Rs 1,370.63 crore.

As the trading session came to a close on Friday, the value of a single share of Paytm was $467.25.

SOURCE: BSH

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