PB Fintech, the parent of insurance aggregator Policybazaar and lending marketplace Paisabazaar, is scripting a steady turnaround on the bourses. After its tepid tepid Livemint PB Fintech IPO closes with 17 times subscription on final day Read more public-market debut in November 2021, the 15-year-old fintech’s stock bottomed bottomed The Ken A year after IPOs, internet companies feel the pain of creating value for public investors Read more out in November 2022. And it has since surged ~67%, ending a year-long free fall.
Driving this renewed investor interest in the company, which has a market capitalisation of ~Rs 27,000 crore (~$3.3 billion), is its consistently improving financial performance in line with the management’s plan of turning profitable profitable Livemint Back PB Fintech’s net loss narrows in Q3, says on track to be profitable this FY Read more by March 2024.
In the quarter ended December 2022, PB Fintech’s revenue rose by two-thirds year-on-year to Rs 610 crore (~$75 million)—its highest ever—while its loss narrowed by nearly three-quarters to just Rs 87 crore (~$11 million). Clearly, PB Fintech isn’t mindlessly burning cash to fuel growth.
But the fintech faces a major threat in soon-to-be-launched Bima Sugam—an online marketplace for policy sales, renewals, and claim settlements. Backed by the insurance regulator, Insurance Regulatory and Development Authority of India (IRDAI), the platform can upend the business as BSE Star MF—a mutual-fund distribution platform launched in 2009—did with mutual funds.
One of the factors behind the company’s impressive December-quarter numbers is a breakthrough in the lending business. Paisabaazar—which now accounts for under one-fifth of the fintech’s revenue—has turned adjusted-Ebitda adjusted-Ebitda adjusted-Ebitda Earnings before interest, taxes, depreciation, amortization, and ESOP costs. -positive, meaning it’s generating enough revenue to cover its expenses, except ESOP ESOP ESOP Employee stock ownership plan costs.
The platform saw a 57% jump in credit disbursals to Rs 3,021 crore (~$370 million) and a 230% surge in the number of credit cards issued to 120,000 in the quarter, primarily on the back of an overall revival in demand for consumer credit after the pandemic abated in the country.