One97 Communications is the parent company of digital payments significant Paytm, and Fino Payments Bank continued to trade under pressure, falling up to 12 per cent on the BSE in Monday’s intra-day trade.

The stock of Paytm slipped 12 per cent to Rs 1,370 on the Bombay Stock Exchange (BSE), extending its 27 per cent decline on Thursday. With today’s fall, the stock has fallen 36 per cent against its issue price of Rs 2,150 as investors remain cautious on its lofty valuation and remain sceptical about its business model.

Paytm is India’s leading digital ecosystem for consumers and merchants. It is the most significant payments platform in India, with a GMV of around Rs 4 trillion in the financial year 2020-21 (FY21). The company offers consumers & merchants technology-led, easy-to-use digital products and services and accessible and inclusive access to financial services.

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“The company has a huge customer base with strong brand positioning, and it has an early mover advantage in digital payment services; however, it is still a loss-making company and very aggressively priced; therefore, we saw a tepid response in terms of subscriptions. It is difficult to value such kind companies for the time being, but by the time market will understand the way to value such kinds of businesses where the market will focus on how fast it will become profitable and how well it will use its strength to explore new businesses like Credit card and Payment banking,” said Santosh Meena, Head of Research at Swastika Investment.

Stock Covered in the news

Fino Payments Bank Ltd-View Detailed Analysis