Softbank exits Paytm at loss of around USD 150 mn
New Delhi, Jul 13: Japan's Softbank investment arm Softbank Vision Fund exited from Paytm in the June quarter at a loss of around USD 150 million, sources aware of the development said.
Softbank invested about USD 1.5 billion in One97 Communications -- the owner of Paytm brand -- in tranches in 2017.
"Softbank has exited Paytm at a loss of 10-12 per cent. The total loss is around USD 150 million," one of the sources said.
Softbank held around 18.5 per cent stake in Paytm before the company's initial public offering (IPO) in 2021. It held a 17.3 per cent stake through SVF India Holdings (Cayman) Ltd and 1.2 per cent through SVF Panther (Cayman) Ltd.
SVF Panther sold its entire stake during the IPO for Rs 1,689 crore, about USD 225 million.
"Softbank announced that it will exit Paytm in 24 months from the time of the IPO. The exit was in line with Softbank's plan. However, the company did anticipate loss at that time," another source said.
Softbank had acquired Paytm shares at an average price of about Rs 800 apiece.
Paytm share price was listed at Rs 1,955, lower by 9 per cent, and has not matched its issue price of Rs 2,150 apiece to date.
The share price of Paytm plummeted further after the Reserve Bank of India (RBI) banned its associate firm Paytm Payments Bank Ltd (PPBL) from carrying out transactions. It touched an all-time low of Rs 310 on May 9.
Paytm reported widening of losses to Rs 550 crore in the fourth quarter of 2023-24 following the ban on transactions related to its payments bank.
The company during the reported quarter wrote off Rs 227 crore investment for a 39 per cent stake in PPBL following future uncertainties associated with its business operations, including the uncertainty of any other regulatory development, etc.
For the year ended March 31, 2024, the company's loss narrowed to Rs 1,422.4 crore. Paytm had recorded a loss of Rs 1,776.5 crore in FY23.
Billionaire Warren Buffet's Berkshire Hathaway Inc also exited Paytm around seven months back by selling shares at a lower-than-acquired price.
The company had acquired 2.6 per cent stake in Paytm for Rs 1,279.7 per share at an aggregate value of Rs 2,179 crore, as per an official document.
The shares were disposed of at an average price of Rs 877.29 apiece, taking the transaction value to Rs 1,370.63 crore in November.
Paytm's shares closed at Rs 467.25 apiece on Friday.
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HC questions Delhi govt over failure to regulate sale of old vehicles, refers to Red Fort blast
New Delhi (PTI): The Delhi High Court questioned the city government on Wednesday over its failure to regulate the sale and transfer of used vehicles, while pointing out that in a recent bomb blast near the Red Fort, a second-hand car was used, making the issue more significant.
A bench of Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela asked the Delhi government to file a detailed response on the issue of regulating authorised dealers of registered vehicles.
"A car changes four hands but the original owner has not changed. Therefore, what happens? That man (the original owner) goes to the slaughterhouse? What is this? How are you permitting this? You will take a call when two-three more bomb blasts take place?" the bench asked the Delhi government's counsel.
The bomb blast near the iconic Mughal-era monument was carried out using a second-hand car, making the issue even more significant, it said.
The court listed the matter for further hearing in January 2026.
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The court was hearing a public interest litigation (PIL) plea filed by an organisation, Towards Happy Earth Foundation, highlighting the challenges in the implementation of rules 55A to 55H of the Central Motor Vehicles Rules, introduced in December 2022 to regulate authorised dealers of registered vehicles.
While the rules were intended to bring accountability to the second-hand vehicle market, the petitioner's counsel argued that they have failed in practice due to regulatory gaps and procedural hurdles.
The plea said there is a major gap in the amended framework, that is, the absence of any statutory mechanism for reporting dealer-to-dealer transfers.
"In reality, most used vehicles pass through multiple dealers before reaching the final buyer, but the rules recognise only the first transfer to the initial authorised dealer.
"As a result, the chain of custody breaks after the first step, defeating the very purpose of accountability," the petition said.
It added that because of these gaps, only a very small percentage of dealers across India have been able to obtain authorised dealer registration and in Delhi, not a single dealer has got it.
Consequently, lakhs of vehicles continue to circulate without any record of who is actually in possession of those, it said.
The plea said only a small fraction of India's estimated 30,000 to 40,000 used-vehicle dealers are registered under the authorised-dealer framework.
The petition also pointed out that the 11-year-old vehicle used in the November 10 bomb blast near the Red Fort was sold several times but was still registered in its original owner's name.
The blast near the Red Fort had claimed 15 lives.
