No Relief For Paytm on Day-2: Stock Plunges Over 12%
By Malvika Gurung
Investing.com — The parent company of the digital payments major Paytm, One 97 Communications Ltd (NS:) continued to tumble over 10% to Rs 1,404.9/share at 2:40 pm on Monday’s session.
Falling freely even on the second day of its launch on the Indian bourses, Paytm has lost Rs 50,000 crore of its market capitalization. The digital payments platform debuted at a discount of 9.3% against its issue price of Rs 2,150, at Rs 1,950/share on Dalal Street on November 18.
The stock closed 27% lower compared to its issue price on Thursday, falling among the worst debutants on Dalal Street. Paytm’s shares have nosedived over 30% since its listing.
With a blurred outlook on profitability and uncertainty over stability in the senior team, many domestic brokerage firms flagged concerns over the fintech stock. Despite having fallen almost 27% on Thursday, investors weren’t too keen on buying the stock for a longer run.
According to analysts at Prabhudas Lilladher, Paytm’s share price will remain subdued in the medium terms, as IPO investors will look out for every opportunity to sell the stock, while no new investor will be willing to buy it until the current market sentiment on the stock changes.
Macquarie has set a target price of Rs 1,200/share on the stock, down 44% of its IPO price, initiating an ‘Underperform’ rating, as Paytm has dived into too many verticals but fails to master any, lacking focus and direction.