Paytm’s pure-play ecommerce business required massive investments in warehousing and logistics for scale, and cashbacks in such a scenario were proving to be a drag. In FY 2018, the company posted a loss of Rs1,787.55 crore on total revenue of Rs774.86 crore, according to the filings. As for Paytm Mall, sources said they expected losses to go up 40-50% for FY 2019, driven by high marketing and promotional expenses.Neil Shah, an analyst at Counterpoint Research, said: “Paytm Mall was not able to crack exclusive partnerships in the mobile and electronics category. App Annie data also show that the company’s active users halved to 4 million in March from 8 million in October. Paytm Mall is hiring 600 people to expand its O2O footprint, it said in a statement to ET.“Paytm knows its DNA is not running a marketplace, it’s a far more robust payments platform so it makes sense to build on that strength,” said Shah of Counterpoint.

Source: Economic Times April 22, 2019 02:26 UTC