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Fino-Payment Bank shows PAT of 4.5 Crores in Q2FY21

Fino Payment Bank which has shown a record growth of transactions in the COVID-19 time has come up with an excellent Q2FY21 number showing PAT of 4.5 Crores. The PAT has gone up from 1.9 Crores in Q1FY21 to 4.5 Crores in Q2FY21. This shows that Fino-Payment bank is growing on a QoQ basis.

Last year i.e. FY19-20, the company was profitable at the EBITDA level but now in FY20-21, the company has shown a profit at the PAT level in the consecutive quarters. The reason for profitability is a lean variable cost of operations along with increasing revenue and pushing out of high-margin products. Fino-Payment bank has reported a total transaction settlement of Rs 33,000 crore in Q2, up 43 percent from the year-ago period.

As per Rishi Gupta, the CEO of Fino-Payment Bank that;

“The biggest positive for us is the change in customer’s banking behavior resulting in increased transactions. We will continue to explore growth opportunities in payment services as well as the trillion-dollar digital payments space and create value for all our stakeholders.

We at UnlistedZone are in the view that the COVID-19 has presented a similar opportunity that had come in 2016 after demonetization, where companies focussing on digital payment will grab more and more market share in the payment business. The people are happy to pay and transfer money instead of using cash to safeguard themselves from COVID-19. After this excellent performance at the PAT level in consecutive quarters, Fino-Payment bank has become the second profitable payment bank in India after Paytm.

Recently, the RBI committee has also given a recommendation allowing Payment banks having operations for 3 years to convert into Small Finance Bank. Let us see if these recommendations are accepted by RBI. If this happens, the Fino-Payment bank will grab the opportunity with both hands. Previously, the time frame was of 5 years.

Valuation of Fino-Paytech?

In the Unlisted market, the shares of Fino-Paytech, the parent company of Fino-Payment bank are available. The current price of shares is 120 per share.

As of 31.03.2020, the total outstanding shares are 12.25 Crores.

Mcap = 1500 Crores.

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