This New-Age Fintech Firm Shoots Up Over 9% After First-Ever Profit

Shares of PB Fintech, the parent company of online insurance aggregator Policybazaar, were surging on Wednesday after the company swung to a profit for the first time.

What Happened: The Gurugram-based company reported a profit after tax of ₹37 crore for Q3, compared with a loss of ₹87 crore in the same quarter of the previous fiscal year, meeting analyst expectations. The company attributed its profitability to robust growth in insurance premiums, improved renewals with higher margins, and enhanced contributing margins.

PB Fintech recorded a 43% growth in operating revenue, reaching ₹871 crore for the December quarter, compared to ₹610 crore in the corresponding quarter of the last financial year.

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Looking Deeper: Its adjusted EBITDA margin improved to 4% during the quarter, compared to minus 5% in the third quarter of the previous financial year. Its contribution margin also increased to 30% for the quarter, up from 26% in the same quarter of the previous financial year.

The company’s cash reserves exceeded ₹5,000 crore. New insurance premiums amounted to ₹2,400 crore, while renewal premiums, which carry higher margins, stood at ₹1,900 crore during the quarter. PB Fintech’s new protection business, covering health and term insurance policies, saw 41% growth.

However, the company’s credit business under the Paisabazaar brand reported slower growth in the second half of the year due to a cautious lending by partners after regulatory measures and statements.

Price Action: Shares of PB Fintech were up 9.06% to trade at ₹991.60 on Wednesday, following the strong Q3 numbers.

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