Paytm Expands Overseas with New Units in Indonesia, Luxembourg; Cuts UAE Stake

According to a stock exchange filing, One97 Communications Ltd., the parent company of the fintech business Paytm, is bringing in an investor for its United Arab Emirates (UAE) payments arm and growing its global presence with new subsidiaries in Indonesia and Luxembourg.

Two step-down fully owned subsidiaries in Indonesia and Luxembourg have been approved for establishment by One97 Communications's wholly owned subsidiary Paytm Cloud Technologies Ltd (PCTL). According to the firm, the planned entities would use a combination of local licences, collaborations, investments, and organic growth to increase the distribution of Paytm's technology-led merchant payments and financial services stack. In one or more tranches, the fintech company intends to invest up to INR 25 crore in each of the two companies.

Alabbar Cutting Down Stakes in Paytm Arab

A separate strategic investment by Abbar Global Opportunities Holdings, a special purpose vehicle (SPV) of UAE billionaire Mohamed Ali Rashed Alabbar, founder of Emaar Properties, is reducing Paytm's ownership in Paytm Arab Payments LLC, its subsidiary established in the United Arab Emirates.

Paytm Arab Payments will give Abbar Global Opportunities 76,862 equity shares as part of the deal, which amounts to 49% of the post-issue paid-up share capital. The issuance is valued at around INR 19 crore in the agreement. Paytm Arab Payments will remain a step-down subsidiary of One97 Communications after the allocation, but it will no longer be a wholly owned subsidiary and will instead become a 51% owned subsidiary of PCTL. It is anticipated that the transaction will be finalised by February 28, 2026.

Why Paytm is Exploring New Markets

This latest event follows Paytm's September quarter net profit of INR 21 crore for the current fiscal year, which is 97% lower than INR 930 crore for the same period last year. An INR 190 crore impairment on its investment in Paytm First Games, a joint venture with One97 Communications, as a result of the government's ban on real-money gaming (RMG) applications, was one of the reasons for the steep drop.

This is consistent with the company's previous declaration that it is investigating specific new areas for future expansion and introducing its cutting-edge technology across merchant payments and financial services to foreign markets, according to the statement filed with the Exchange. Operating revenue for the Noida-based company increased 24% year over year (YoY) to INR 2,061 crore from INR 1,659 crore the year before.