Paytm Layoffs: One97 Communications, the parent company of Paytm facing crisis, is going to sacrifice 5000 to 6300 of its employees. On the other hand, its stock also fell 4.55% today to Rs. 340.05 has happened. It has declined by about 62 percent in the last six months. The stock has fallen more than 47 percent so far this year.
Why layoff will happen: The reason behind this drastic decision by the company is to reduce its personnel expenses in this financial year. According to a Financial Express report, the company may reduce its work force by around 15 to 20 percent. This means that 5,000-6,300 employees in the total work force may lose their jobs. One97 Communications aims to save ₹400 to ₹500 crore.
The stock at Rs 48 touched Rs 147 on the first day, making a profit of over 200%
When will layoff take place: One97 Communications had an average of 32,798 employees on its payroll in fiscal year 2023. 29,503 of them were actively employed. Total personnel expenditure for the financial year increased by 34 per cent year-on-year to ₹ 3,124 crore. The report claims that layoffs of more than 1,000 employees began in December.
Net loss of ₹550 crore: Paytm reported a net loss of ₹ 550 crore in the fourth quarter, compared to ₹ 168 crore last year. The company’s revenue from operations fell 3 percent year-on-year to ₹2,267 crore in the March quarter after the Reserve Bank of India (RBI) banned Paytm Payments Bank. The Paytm CEO expects the company to see a near-term financial impact on revenue and profitability following the RBI ban on its associate Paytm Payments Bank.
Paytm CEO Vijay Shekhar Sharma, in a letter to shareholders, explained the company’s commitment to strengthen the governance framework, improve cost efficiency and address the impact on the company’s financial performance due to regulatory measures.