One 97 Communications (Paytm) has significantly increased its ownership in its gaming subsidiary, First Games Technology Private Limited (FGTPL), moving from a 55% stake to 82.6% on a fully diluted basis. The move, approved by the board on April 16, 2026, involves the conversion of an outstanding loan of ₹197 crore (including unpaid interest) into equity.
This strategic restructuring comes as Paytm cleans up its subsidiary balance sheets following major regulatory shifts in the Indian online gaming sector.
Strategic Debt-to-Equity Conversion
The transaction is a financial restructuring rather than a fresh cash infusion, aiming to simplify the subsidiary’s capital structure:
- The Transaction: Paytm converted the ₹197 crore loan into 19.67 crore equity shares at a par value of ₹10 each.
- Financial Impact: The company clarified that there is no fresh financial impact on its books, as Paytm had already fully impaired its equity and loan investments in FGTPL in previous quarters.
- Timeline: The conversion process is expected to be completed by April 30, 2026, through Paytm Services Private Limited.
The Post-Gaming Pivot
The increase in stake follows a turbulent period for First Games, which was forced to discontinue its core real-money gaming (RMG) business on August 25, 2025.
The closure was a direct result of the “Promotion and Regulation of Online Gaming Act, 2025,” which introduced stringent tax and licensing hurdles for RMG platforms in India. FGTPL’s turnover had already seen a sharp decline, falling from ₹320.58 crore in FY23 to just ₹90.82 crore in FY25.
New Credit Guarantees: The ₹90 Crore DLG
In a separate but related move to bolster its lending business, Paytm’s board also approved a Default Loss Guarantee (DLG) of up to ₹90 crore.
- The Partner: The guarantee is for loans disbursed by Piramal Finance Limited.
- The Model: This aligns with the RBI’s updated DLG guidelines, allowing fintechs to provide a safety net for their lending partners. Paytm will earn revenue through sourcing and collection fees while taking on a limited credit risk.
First Games Technology: Financial Trajectory
| Metric | FY 2022-23 | FY 2024-25 | Trend |
| Annual Turnover | ₹320.58 Cr | ₹90.82 Cr | -71.6% |
| Net Worth | — | ₹(267.08) Cr | Negative |
| Paytm Stake | 55% | 82.6% (New) | Increased Control |
Market Sentiment: Paytm’s “Indian-Owned” Status
The stake increase in its subsidiary coincides with a broader milestone for the parent company. As of April 2026, Paytm has officially become an Indian Owned and Controlled Company (IOCC).
With domestic investors (including mutual funds and insurance giants like Tata AIA and SBI Life) now holding 50.3% of the equity, the company has successfully reduced its reliance on foreign strategic capital from firms like Ant Financial and SoftBank, who fully exited in 2024 and 2025. Analysts believe this new status could pave the way for smoother regulatory approvals from the RBI as Paytm seeks to expand its payment aggregator and lending licenses.
