Indian digital payments and financial services company Paytm founder Vijay Shekhar Sharma on Tuesday said that Alibaba was never a strategic shareholder in the company. This comes days after the Chinese e-commerce behemoth sold its shares in the Indian fintech business worth $125 million.
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Sharma said in an exclusive interview with Shereen Bhan of CNBC-TV18 that the sale could have been arranged better and that the corporation was not made aware of it in advance. "We did not know Alibaba had sold stake till it was disclosed to the market," he informed.
Alibaba and Ant Financial, a subsidiary of Alibaba, made an investment worth $680 million for over 44 percent equity stake in the company in 2015, making them the firm's top shareholders. The duo still controls about 28 percent of Paytm even after selling shares in the Noida-based fintech in the IPO and the recent sale.
Sharma, who was speaking on the sidelines of the World Economic Forum in Davos, noted that the year 2022 has been a learning curve for the whole company. He said that "Paytm has grown from a teenager to an adult," adding that the maturity that would have taken 2 years happened in just 2 quarters.
"Our numbers are 'Gangbusters' in the public eye, and I'm happy to say that we are a payment company that is profitable and a credit distribution business that has become a market leader," he said.
Since the unicorn fintech company went public in November 2021, experts and investors have questioned its business strategy, road to profitability, and danger from regulatory changes, causing its shares to lose 75 percent of their value.
When asked about the company's profitability plans, Sharma stated that Paytm is definitely looking at profitability, but not at the cost of reducing anything.
The firm previously informed investors that it will attain adjusted EBITDA break-even by the September 2023 quarter. Sharma told CNBC TV18 that it may occur sooner than anticipated.
"Focus on what we believe will give us a large profit pool over the long term. We are still at a very early stage in the online payments game. There is a huge organic growth out there for payments with ~100 million merchants of which only 35-40 million are active," he said.
"There is so much to do in India that we're not looking at the rest of the world just yet. Why should we waste our time building for other countries when we can give back to our own country?” he added.
He also talked about the company's plans to add verticals to their existing businesses beyond payments and credit.
Watch video for full interview