Paytm To Invest INR 455 Cr In Subsidiaries, Shuts RMG Ops

SUMMARY

Paytm’s board also approved an investment of INR 155 Cr in its subsidiary PSPL, which is engaged in the providing "manpower supply and related services"

Meanwhile, Varun Sridhar has quit as the the CEO of PSPL to start a new venture in the wealth tech segment

Paytm also announced that First Games has officially discontinued its real money gaming (RMG) operations and carried an investment value of "nil" at the end of Q1 FY26

In a bid to bolster its revenue streams, fintech giant Paytm’s board has approved an investment of INR 300 Cr in its investment tech subsidiary, Paytm Money.

In an exchange filing, the company said that Paytm Money will issue 30 Cr additional equity shares at a face value of INR 10 apiece to it.

Paytm Money operates in the investment and wealth management services segment, providing services like stock broking, mutual fund distribution, among others. Paytm has been bullish about the subsidiary’s future prospects. In its Q1 earnings call, CFO Madhur Deora said that Paytm was doing very well on the equity broking side.

Earlier this year, Paytm Money received the approval from the Securities and Exchange Board of India (SEBI) to operate as a registered research analyst. Brokerage firm Motilal Oswal then said that the licence opens a new opportunity for the company to diversify into wealth management, thus, potentially unlocking a “new stream of fee-based income”.

However, Paytm Money’s turnover declined about 10% to INR 172.9 Cr in FY25 from INR 194.1 Cr in the previous fiscal year.

Notably, the subsidiary has seen top management rejig in recent months. Rakesh Singh, who had been leading Paytm Money as its MD and CEO for more than a year, left the position to take up a new role within the Paytm Group. He was succeeded by former HDFC Securities’ chief operating and digital officer Sandiip Bharadwaj.

The investment in Paytm Money was one among a slew of approvals given by Paytm’s board. It also approved an investment of INR 155 Cr in Paytm’s subsidiary Paytm Services Pvt Ltd (PSPL). The subsidiary is engaged in providing “manpower supply and related services” and had a turnover of INR 252.4 Cr in FY25.

The turnover of the subsidiary zoomed about 64% from INR 154.4 Cr in FY24. PSPL was earlier called Balance Technology Pvt Ltd. Notably, Paytm acquired Balance Technology in 2018.

Meanwhile, Varun Sridhar, the CEO of PSPL, has quit. In a LinkedIn post, Sridhar said he is moving on from Paytm after spending 5 years at the company. Sridhar was earlier the CEO of Paytm Money, and was succeeded by Singh at the investment tech subsidiary.

Sridhar told Economic Times that he plans to start a new venture in the wealthtech segment.

Besides the investments, Paytm said it is also transferring 55% stake in its real money gaming platform, First Games, from its wholly owned subsidiary Paytm Cloud Technologies to PSPL for an aggregate amount of INR 140 Cr. The transaction, it said, is part of the Group’s internal restructuring to simplify group structure.

Paytm also announced that First Games has officially discontinued its real money gaming (RMG) operations. It said that the subsidiary, which is a joint venture between Paytm and Chinese gaming company AGTech Holdings, carried an investment value of “nil” at the end of Q1 FY26.

“Company’s share of profit/ loss of First Games as per the equity method, is less than 1% of OCL’s (One97 Communications) consolidated profit / loss for the quarter ended June 30, 2025. OCL does not have any exposure due to this other than a shareholder loan of approximately INR 200 Cr, including applicable interest, as on June 30, 2025,” it said.

The shut down of the RMG operations follows the government’s ban on real money gaming in India.

Besides, Paytm’s board also approved the transfer of 90.01% stake of Foster Payment Networks Private Limited, an associate company, from another associate company, Paytm Financial Services Ltd, to OCL for an aggregate amount of up to INR 54.50 Cr.

The balance 9.99% will be transferred from the other shareholder of Foster Payment for an aggregate amount of up to INR 6.50 Cr, resulting in the company becoming a wholly owned subsidiary of Paytm.

The developments come over a month after Paytm reported a profitable quarter. The fintech major posted a net profit of INR 122.5 Cr in Q1 FY26 as against a net loss of INR 840.1 Cr in the year-ago quarter.

Shares of the company ended yesterday’s trading session 0.9% higher at INR 1,276.20 on the BSE.