Shares of One97 Communications, the parent company of India’s leading mobile payments and financial services provider, Paytm, took a hit as the stock slipped 5 per cent to Rs 351.70 on the Bombay Stock Exchange (BSE) on Monday at 02:06 PM. This sudden dip was attributed to the resignation of President and Chief Operating Officer (COO) Bhavesh Gupta, amidst the company’s ongoing organizational restructuring.
The departure of Bhavesh Gupta, who was overseeing the payments and lending businesses, marks the third senior resignation from Paytm in recent months. The decision comes after Paytm Payments Bank (Paytm PB), an associate entity of One97 Communications, faced regulatory scrutiny from the Reserve Bank of India (RBI).
During a board meeting held on Saturday, May 4, 2024, Paytm accepted Gupta’s resignation, effective from May 31. Gupta cited personal reasons for his decision to take a career break but expressed his commitment to support Paytm in an advisory capacity, guiding its growth initiatives until the end of the year.
Paytm, in an exchange filing, revealed its plans to expand its leadership team to strengthen its position in the payment and financial services sector. The company aims to build a large and profitable distribution network, aligning with its ambition for sustained growth across key business verticals while ensuring regulatory compliance and sustainability.
“Bhavesh Gupta’s decision to take a career break is due to personal reasons. I look forward to supporting Paytm in an advisory role,” said Gupta. “I am confident of Paytm reaching new heights given the depth of leadership in payments and financial services that has been built over the past few years.”
Despite the recent setbacks, Paytm remains India’s leading mobile payments and financial services distribution company, serving 333 million consumers and over 20 million merchants. Its offerings span payment services, commerce, cloud services, and financial services, primarily in loan distribution.
The market reaction to Bhavesh Gupta’s resignation underscores investor concerns about the company’s stability amidst leadership changes and regulatory challenges. However, Paytm’s strategic focus on expanding its leadership team and ensuring compliance signals its commitment to navigate these challenges and continue its growth trajectory in India’s dynamic financial services landscape.
