By TechThop Team
Posted on: 13 Aug, 2022
Shares of India's digital payments firm Paytm fell 6.2% on Friday after a proxy advisory firm opposed its chief executive's reappointment and the central bank's guidelines for digital lending apps.
The institutional investor advisory service said it opposes Vijay Shekhar Sharma being reappointed as chief executive officer and managing director at the company's annual general meeting next week.
The company has made several commitments, including the promise of making the company profitable in the past, however, these have not been fulfilled.
The IIAS concluded in a report dated August 9 that the board should consider how it might improve the management of the company.
A report last week showed Paytm's parent, One97 Communications Ltd, had an operating loss of 6.44 billion rupees for the June quarter, but said it remains on track to become financially profitable by September 2023.
The IIAS also raised concerns about Sharma's overall remuneration, estimated at 7.96 billion rupees for fiscal 2023, which was higher than that of CEOs of most profitable companies on the S&P BSE Sensex.
As further evidence of its troubles, Paytm informed investors on Thursday that the latest guidelines issued by the central bank concerning.
The increase in scrutiny of digital lending apps could hurt its buy-now-pay-later program.
During this period, we believe Paytm's lending business disbursement growth might be affected,' Macquarie analysts observed in a note published on Friday.
A separate statement from Paytm said that macroeconomic challenges may moderate the growth of its business. Loan disbursements increased by nearly 300% in July, according to the company.
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