Mumbai1 hour ago
- Copy link
Paytm Founder and CEO Vijay Shekhar Sharma (File photo).
Paytm has announced on Wednesday (16 April) that the company's founder and CEO Vijay Shekhar Sharma has left 21 million ie 2.1 million Employee Stock Options (ESOPS) given to him. SEBI had issued a show cause notice on violation of the rules for giving share-based employee benefits. After which the company has now given this information in the filing.
In August 2024, the Market Regulator Security Exchange Board of India (SEBI) had reported that giving Vijay Sharma a 2.1 million Employee Stock Options (ESOPS), a violation of its rules controlling share-based employees benefits. According to Indian rules, large shareholders who have the ability to influence the company's decisions cannot have Esops.
Vijay Sharma had a 14.7% stake in Paytm a year ago
Vijay Shekhar Sharma had a 14.7% stake in Paytm, a year before the company's 2021 public filing of 2021. To become the eligible ESOP grants, Vijay had reduced his shareholding to 9.1% by transferring 30.97 million or 30.97 crore shares to Axis Trustee Services. Axis Trustee Services worked on behalf of Sharma Family Trust.
SEBI had issued these notices to Vijay Sharma and other board members, who played a role in the Paytm's November 2021 IPO to introduce the facts incorrectly.
Vijay decided to discard 2.1 crore Esops voluntarily
According to the filing, Vijay Sharma said that he has decided to voluntarily abandon all the 2.1 crore Esops given to him under the One 97 Employees Stock Options Scheme 2019. The company has also reported in the filing that a portion of the unavested ESOP has been canceled, while the remaining has been returned to the ESOP pool under the company's ESOP scheme.
ESOP Expend will increase by ₹ 492 crore in the fourth quarter
The filing states that ESOP Expend will increase by ₹ 492 crore in the fourth quarter of FY 2025 and ESOP Expans will decrease in future years. Paytm said that the company will share details on its ESOP cost schedule with its Q4 FY 2025 results.
The company made several changes in its ESOP in March
SEBI issued a show cause notice to Paytm in August 2024 regarding giving ESOP to Vijay Shekhar Sharma. The company changed its ESOP in March, in which ESOP Westing, among other changes, was associated with the latest appraisal exercise with annual performance ratings.
Paytm also expanded its ESOP pool in recent months and has allotted ESOP to Eligible Employees at least twice in the last six months. Employee Stock Option (ESOP) is a scheme under which Employee gets the option to buy the company shares, which are usually at a lower price than the market value.
Paytm loss of ₹ 208 crore in third quarter
Paytm's parent company One 97 Communications has reduced the net loss to Rs 208 crore in the third quarter (October-December) of FY 2024-25. Paytm's deficit in the same quarter of a year ago was Rs 220 crore. The company's revenue fell 36% to Rs 1,828 crore in the October-December quarter. It was Rs 2,850 crore in the same quarter of a year ago i.e. Q3Fy24.
In the second quarter, Paytm had a net profit of ₹ 930 crore, the movie ticketing business brokery had a lump sum of ₹ 1,345 crore to the company's net profit. Except for this amount, Paytm had a loss of ₹ 415 crore.
Paytm started in 2009
Paytm Payment App was launched by Paytm's parent company One 97 Communications in August 2009. Its founder is Vijay Shekhar Sharma. At present, Paytm has more than 30 million users in the country. The market cap of Paytm is about 28 thousand crores.
