Release Date: May 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- One97 Communications Ltd (BOM:543396, Financial) has achieved a break-even point, indicating improved financial health.
- The company has successfully expanded its lending partnerships, now having between 8 to 10 partners for personal and merchant loans.
- There is optimism about the potential monetization of UPI transactions, which could enhance revenue streams.
- AI implementation has led to significant cost reductions, particularly in non-sales employee costs, enhancing operational efficiency.
- The merchant side of the business is performing well, with strong growth in merchant acquisition and lending.
Negative Points
- Personal loan disbursements have not grown quarter-on-quarter, reflecting challenges in the lending segment.
- The consumer user base remains below levels from a year and a half ago, indicating potential issues in user retention or acquisition.
- There is uncertainty regarding the implementation of MDR on UPI transactions, which could impact future revenue projections.
- The financial services customer base has declined quarter-on-quarter, raising concerns about user engagement in this segment.
- The company faces competitive intensity in the market, which may affect margins, especially if MDR is introduced.
Q & A Highlights
Q: Can you provide insights on the current trends in personal loans and the number of lending partners?
A: Vijay Sharma, CEO, mentioned that personal loan disbursements did not grow quarter-on-quarter due to a shift towards a pure distribution model. Madhur Deora, CFO, added that they have between 8 and 10 lending partners for personal and merchant loans, with a total of about 14 lending partners.
Q: What are your expectations regarding MDR on UPI for larger merchants and its impact on monetization?
A: Vijay Sharma stated that while they cannot predict government actions, they expect MDR on UPI to be introduced soon, which would enhance monetization opportunities. Madhur Deora added that UPI incentives are expected to remain low, especially once MDR is implemented.
Q: How is AI contributing to cost reductions, and what future savings do you anticipate?
A: Vijay Sharma highlighted that AI is increasing productivity per employee, leading to cost reductions. They are not replacing positions that become vacant, and AI is expected to continue improving efficiency. Madhur Deora emphasized their commitment to leveraging AI for smarter and more efficient operations.
Q: What is the strategy for recovering the user base, and how important is it for revenue growth?
A: Vijay Sharma explained that while incremental users are important, the focus is on product improvement to drive growth. They aim for 200-250 million highly engaged users and are not overspending on marketing, preferring to invest in technology and product attention.
Q: What is the outlook for international markets and technology stack exportation?
A: Vijay Sharma clarified that international expansion involves monetizing their technology stack by partnering with local markets rather than launching the Paytm app abroad. They focus on product technology monetization, particularly on the merchant side.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
