Fintech giant Paytm announced that it will not handle its entertainment and ticketing business. This department of Paytm is going to sell it to food delivery app Zomato. This agreement between the two companies is being done for Rs 2048 crore i.e. Paytm will sell entertainment and ticketing business to Zomato for Rs 2,048. After this, Paytm’s share price increased by more than 5%. Paytm shares reached Rs 604.45 on BSE, while Zomato shares rose 2.71% to Rs 267.00. According to the agreement, Paytm’s parent company One 97 Communications entered into definitive agreements for the sale of its entertainment ticketing business, which includes movie, sports and event ticketing, which will be sold to Zomato for Rs 2,048 crore.
Paytm’s movie and event tickets will remain available on its app for the next 12 months during a transition period, after which users will be redirected to Zomato’s upcoming app to ‘go out’. Following the deal, Emkay Global Financial Services said, “Post acquisition, Zomato’s management estimates GOV to be in excess of Rs 10,000 crore in FY26. Management expects the going-out business to operate close to break-even on an adjusted EBITDA basis, while potentially delivering 4-5% of adjusted EBITDAM as a percentage of GOV over the medium to long term. Management’s strong execution track record leads to confidence that going-out will add further value over the long term.”
“In our view, the deal will enhance Paytm’s cash and cash equivalents, which will likely be used to enhance its rewards/cash-back programme to revive its sagging payments business post the RBI action. The net one-time gain adjusted for revenue expenses will narrow the net loss in FY25E but hurt future earnings,” it added.
