Paytm E-commerce reports net loss of Rs 1,171 crore, revenues jump by 25%

Paytm E-commerce Private Limited (Paytm Mall), the online shopping platform, reported a net loss of Rs 1,171 crore for the financial year 2018-19. This is a 34 per cent decrease from the last financial year. However, the company reported its revenues for the same fiscal as Rs 968 crore, a 25 per cent jump since the last financial year, according to data accessed by business intelligence platform Tofler. The company’s total expenses for the fiscal were reported as Rs 2,140 crore.

The company is integrating its offline merchant base with international sellers on a single platform in a bid to take on the competition such as Amazon and Flipkart. This will help its 300,000 offline merchants access international brands from across the world. The company has also set up an office in China and was planning to source and identify items it believed would sell in India. Listing Chinese merchants on its platform from where customers can buy directly was another new initiative.

Paytm Mall has raised a total of $795 million in funding from top investors including SoftBank Vision Fund and Alibaba, according to data platform Crunchbase. This year in July, US-based e-commerce firm eBay bought a 5.59 per cent stake in Paytm Mall for $160 million. The deal enabled Paytm Mall to start getting catalogues from the US and Europe.

Eager to make their presence felt during the festive season, Paytm Mall and eBay were bulking up their offers of the global catalogue. This month, Paytm Mall said it would generate at least Rs 500 crore in actual sales for its offline brick-and-mortar retailers this festive season. The announcement came at a time when trader bodies are at loggerheads with Amazon India and Flipkart over the massive discounts during such sale drives.

Over the past six months, the firm had worked out massive discount and cashback schemes, with more than 100 brands and major offline retailers. Overall, Paytm Mall said it was targeting not less than $2.1 billion (Rs 14,900 crore) in gross merchandise value (GMV) for the entire year.

During the festive season itself, the company said it was aiming at least $300 million (Rs 2,100 crore) in GMV.

E-commerce companies are facing huge losses in pursuit of dominating the country’s growing online commerce market which is expected to touch $200 billion by 2028, from about $30 billion last year.

Amazon has faced losses in several of its business entities in India, such as seller services, wholesale, transportation services and digital payments, for the 2018-19 financial year. According to the regulatory documents, the combined losses of these entities stand at over Rs 7,000 crore.

Also, Flipkart India Private Limited, the wholesale entity of Walmart-backed homegrown e-commerce firm Flipkart, has suffered an increase in net loss by 85.91 per cent in the financial year 2018-2019 compared to the previous year. Flipkart India Private Limited reported a net loss of Rs 3,836 crore as compared to Rs 2,063 crore in the previous financial year, according to the regulatory documents.