Paytm expands overseas presence with Indonesia, Luxembourg units; dilutes UAE arm stake

One97 Communications Ltd, the parent of fintech firm Paytm, is expanding its overseas footprint by setting up new subsidiaries in Indonesia and Luxembourg, while also diluting its stake in its United Arab Emirates payments arm, according to a stock exchange filing, The Economic Times reported.

Paytm Cloud Technologies Ltd, a wholly owned subsidiary of One97 Communications, has approved the incorporation of two step-down wholly owned subsidiaries in Indonesia and Luxembourg. The proposed entities will focus on expanding the distribution of Paytm’s technology-led merchant payments and financial services stack through a combination of local licences, partnerships, investments and organic expansion, the company said, as per The Economic Times report.

The fintech firm stated that it plans to invest up to Rs 25 crore in each of the two subsidiaries, to be deployed in one or more tranches.

Separately, Paytm is diluting its stake in Paytm Arab Payments LLC, its UAE-based subsidiary, through a strategic investment by Abbar Global Opportunities Holdings, a special purpose vehicle of UAE billionaire Mohamed Ali Rashed Alabbar, the founder of Emaar Properties.

Under the transaction, Paytm Arab Payments will issue 76,862 equity shares to Abbar Global Opportunities, representing 49% of the post-issue paid-up share capital. The issuance has been valued at approximately Rs 19 crore, the filing stated.

Following the allotment, Paytm Arab Payments will cease to be a wholly owned subsidiary and will instead become a 51% owned subsidiary of Paytm Cloud Technologies Ltd, while continuing to operate as a step-down subsidiary of One97 Communications. The transaction is expected to be completed by February 28, 2026.

The company stated that the move is in line with its earlier disclosures on exploring select new markets for future growth and taking its advanced merchant payments and financial services technology to international markets.

The expansion comes at a time when Paytm reported a net profit of Rs 21 crore in the September quarter of the current financial year, marking a 97% decline from Rs 930 crore in the corresponding period last year. The sharp fall was attributed in part to a Rs 190 crore impairment on its investment in Paytm First Games, a joint venture with One97 Communications, following the government’s ban on real-money gaming applications.

During the same period, the Noida-headquartered company’s operating revenue rose 24% year-on-year to Rs 2,061 crore, compared with Rs 1,659 crore in the previous year.