Paytm board shelves bonus issue, prioritises growth and profitability

One 97 Communications, which operates fintech platform Paytm, has decided against proceeding with its proposed maiden bonus issue for now, saying it will instead focus on expanding the business and improving profitability to create long-term shareholder value.

The board discussed the proposal at its meeting on July 20 before deciding not to take it forward “at this time”, the company said in a stock exchange filing. Paytm may reconsider a bonus issue later.

Paytm had informed the exchanges on July 15 that the proposal would be considered alongside its financial results for the April-June quarter. It had not disclosed a proposed bonus ratio or record date. Had it been approved, this would have been the company’s first bonus issue since its November 2021 listing.


Bonus shares are allotted free to existing shareholders in proportion to their holdings. They increase the number of outstanding shares but do not alter an investor’s proportionate ownership in the company.

The decision came as Paytm reported a 79% year-on-year increase in consolidated net profit to Rs 220 crore for the June quarter, from Rs 123 crore a year earlier. Revenue from operations rose 28% to Rs 2,448 crore from Rs 1,918 crore. Sequentially, net profit increased from Rs 183 crore in the March quarter, while operating revenue rose from Rs 2,264 crore.

Paytm had reported its first full-year profit in 2025-26, posting a net profit of Rs 552 crore compared with a loss of Rs 663 crore the previous year. Revenue from operations increased 22% to Rs 8,437 crore, supported by growth in payments and distribution of financial services and tighter control over costs.

At Monday’s meeting, the board also approved an investment of up to Rs 100 crore in its wholly owned subsidiary, Paytm Money, to fund technology, regulatory capital, and the expansion of its investment and wealth-management businesses.

Separately, Paytm will seek shareholder approval to revise the use of Rs 1,686 crore in unspent initial public offering proceeds and extend the utilisation deadline to March 2029. The funds were originally set aside for new businesses, acquisitions and strategic partnerships. Paytm wants flexibility to also deploy the money towards acquiring and retaining consumers and merchants and strengthening its payments and financial-services ecosystem.

The proposed bonus issue would have been Paytm’s first major shareholder-related corporate action since its Rs 850-crore open-market share buyback, announced in December 2022 and completed in February 2023. The company listed after an Rs 18,300-crore initial public offering priced at Rs 2,150 per share. On Monday, the company’s stock ended flat at Rs 1,348.50 on the National Stock Exchange (NSE).