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After Institutional Investor Advisory Services India Limited (IiAS), two other advisory firms–Stakeholders Empowerment Services (SES) and InGovern Research Services are also opposing the reappointment of Vijay Shekhar Sharma as its CEO and MD of Paytm.

The three advisory firms are advising Paytm’s stakeholders to vote against the fintech major’s recent move of promoting Sharma from chairman position to the startup’s CEO and MD, according to the Business Standard report.  

“Sharma is not liable to retire as director by rotation, that’s the main problem in our view.

As far as the share price performance is concerned, Paytm is not a unique case. All new-age companies have seen their stock prices tank from the highs,” said Shriram Subramanian, founder and managing director of InGovern.

While InGovern is against Sharma’s appointment as Paytm managing director, SES raised concerns over Sharma’s remuneration as the fintech major’s chairman and MD.

In its report, SES said, “The remuneration of Sharma as the MD and CEO of Paytm for three financial years (FY22, FY23 and FY24)… is in excess of the limits specified under Section 197 and Schedule V of the Company Act.” 

The report further stated that there is no legal bar on Sharma holding the CEO position but SES believes that the fintech major should have separated the position since combining both positions may lead to concentration of powers in the hands of a single person.

Yesterday, IiAS also opposed Sharma’s reappointment and remuneration as Paytm CEO and MD on the grounds that Sharma was unable to fulfil his commitments and make the fintech major profitable. 

IiAS’ report said, “ Sharma has made several commitments in the past to make the company profitable, however, these have not played out. We believe the board must consider professionalising the management.”

IiAS further shared that Sharma would receive over INR 796 Cr as remuneration in FY23, including 21 Mn stock options at a price of INR 9 per share.

Post this announcement, Paytm’s shares tanked by 4.67% to INR 787.15 on the Indian bourses as on 12th August. Yesterday, its shares opened at INR 820 and plunged to the lowest of INR 775 intraday.

Most recently, Paytm also announced that it disbursed 2.9 Mn loans in the month of July, thus taking the total loan value to $264 Mn during the last month.

Besides this, its loan disbursements stood at an ARR of $3 Bn in July while in June, its loan disbursements ARR were more than 24K Cr. 

In the June quarter of FY22, Paytm’s parent One97 Communications widened its losses by 69% to INR 645.4 Cr while its revenue from operations increased by 89% year-on-year to INR 1,680 Cr.