Paytm CEO Surrenders 21 Million ESOPs Worth ₹1,800 Crore After SEBI Notice, Triggers ₹492 Crore Q4 Expense

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Updated Apr 16, 2025, 07:34 PM

Paytm founder and CEO Vijay Shekhar Sharma has voluntarily surrendered 21 million (2.1 crore) employee stock options (ESOPs) granted under the One 97 Employees Stock Option Scheme, 2019. The ESOPs, valued at approximately ₹1,800 crore based on the latest share price, will be returned to the company’s ESOP pool and were unvested at the time of surrender. The decision follows a Securities and Exchange Board of India (SEBI) notice in August 2024, which flagged the ESOP grant as not compliant with regulations governing employee benefit schemes. Sharma had reduced his stake in Paytm from 14.7% to 9.1%, transferring more than three crore shares to Axis Trustee Services to become eligible for the ESOP grant. As a result of the surrender, Paytm will incur a one-time, non-cash acceleration of ESOP expenses amounting to ₹492 crore in the fourth quarter of FY25, with a corresponding reduction in future ESOP expenses. Paytm has never reported a positive EBITDA since its listing in November 2021, but has highlighted EBITDA before ESOP expenses as a key metric. For the March quarter, Paytm is expected to report an EBITDA of ₹64 crore on revenue of ₹2,051 crore, with an adjusted net loss of approximately ₹9 crore. Shares of One97 Communications closed 3% higher at ₹864.95 on the NSE, extending a rally of nearly 30% since March 10, compared to a 4.3% gain in the Nifty50 index. Of 19 analysts tracking the stock, nine have a 'Buy' rating, with Mirae Asset Securities assigning a target price of ₹1,210 per share. The company will announce its results on May 30, 2025.

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