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Paytm's parent company, One 97 Communications, experienced a significant surge in share price on Tuesday, closing at Rs 753.60, a 15.65% increase. This jump followed an intraday high of Rs 771.95, representing an 18.47% gain. The stock has delivered multibagger returns, rallying 143.10% from its one-year low of Rs 310, reached on May 9, 2024. However, it remains 24.51% below its 52-week high of Rs 998.30, achieved on August 20, 2023.
Despite the recent surge, Paytm continues to face challenges stemming from regulations imposed by the Reserve Bank of India (RBI). Last year, RBI placed restrictions on Paytm Payments Bank's operations due to persistent non-compliance and concerns regarding supervision. These restrictions have put pressure on the fintech firm. However, Paytm's founder and CEO, Vijay Shekhar Sharma, has reaffirmed the company's commitment to reapplying for a payment aggregator (PA) license from the RBI, stating that they will submit an application in due course. This commitment came alongside Paytm Payments Services Ltd (PPSL), a subsidiary of Paytm, securing approval from the Indian government for further investment in its payment services business.
Despite the regulatory challenges, analysts remain optimistic about Paytm's future. They anticipate further upside potential, with several predicting a short-term target of Rs 900. Market experts highlight Paytm's strong position, citing its current trading price of Rs 750 and potential for a rally in the near future. The company's recent sale of its entertainment ticketing business to Zomato for Rs 2,048 crore in August 2024 further suggests a strategic focus on core payment services and other growth avenues. While the stock has shown significant strength, maintaining key support zones will be critical to sustain the current bullish trajectory.
Source: Paytm shares zoomed 18% in fag-end trade; analysts see more upside potential in this multibagger