Paytm block deal: 1.57 crore shares change hands; stock slips nearly 5%

At around 10:01 a.m., shares of Paytm traded 2.78 per cent or Rs 25.65, lower on the BSE at Rs 897.15 apiece. The market capitalisation stood at Rs 56,938.55 crore at around the same time.

During the market opening, 1.57 crore shares, which translates to 2.5 per cent equity, changed hands via multiple block deals in Paytm, image- Reuters

Shares of One 97 Communications, the parent company of Paytm, slipped nearly 5 per cent in Friday's trade (November 24) to touch the day's low of Rs 880 apiece on the BSE. The stock witnessed selling after a block deal of 1.57 crore shares.

At around 10:01 a.m., shares of Paytm traded 2.78 per cent or Rs 25.65, lower on the BSE at Rs 897.15 apiece. The market capitalisation stood at Rs 56,938.55 crore at around the same time.

During the market opening, 1.57 crore shares, which translates to 2.5 per cent equity, changed hands via multiple block deals.

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The details of the buyers and sellers of Paytm shares in the block deal are unavailable.

Paytm Q2 performance

Payments and financial services company and pioneer of QR, Soundbox, and mobile payments in Q2FY24 recorded a revenue of Rs 2,519 crore, a surge of 32 per cent year-on-year (YoY), and its earnings before interest, tax, depreciation, and amortisation (EBITDA) before ESOP cost improved to Rs 153 crore as compared to Rs 84 crore in Q1FY24 (excluding UPI incentives).

Brokerages' views

In its October 18 coverage report, Jefferies initiated a 'buy' on Paytm shares for a target price of Rs 1,300 apiece.

The brokerage believes the payment company will turn profitable in the next four quarters, led by substantial growth in the credit business and monetisation.

"In the next four quarters, Paytm will turn profitable and be among the few large profitable fintechs globally that enjoy strong growth (>30 per cent), double-digit EBITDA margins, and stable profitability.

However, its valuations at 3.6x FY25 EV/revenue remain at a nearly 40 per cent discount to this group," Jefferies said.

After the Q2 result announcement, CLSA maintained a 'buy' on Paytm and raised the target price to Rs 1,200.

Citi raised the target to Rs 1,300 from Rs 1,160, and Morgan Stanley maintained an equal-weight rating on the counter with a target price of Rs 830.

Paytm share price: Past performance

In 2023 so far, shares of Paytm have gained over 68 per cent against the Nifty50's rise of over 8 per cent.

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