Paytm shares rise after four sessions of losses; here’s why

Shares of Paytm Ltd (listed as One97 Communications)  rose after four days of losses today after the firm said it reported a 254 per cent rise in disbursements from credit business to Rs 4,158 crore in February 2023. The number of loans climbed 86 percent from the last year to 40 lakh in February, the digital payments firm said in its monthly performance update.

The company's consumer base continued to rise as average monthly transacting users (MTU) of 8.9 crore for the quarter-to-date climbed 28 percent over February 2022.

Additionally, sentiment was positive around the stock after Paytm CEO and co-founder Vijay Shekhar Sharma on Saturday said that Silicon Valley Bank (SVB), which was one its early backers, was no longer a stakeholder in the fintech giant. SVB had exited even before the recent crisis at the bank, he said.

“Silicon Valley Bank was one of my first investors when Ash Lilani supported us in first around of investments at One97. Thanks to him, we grew from a telco value-added services company to what we are today,” the Paytm CEO said in a tweet.

Buoyed by the February business performance, the Paytm stock rose 3.3% to Rs 612.65 against the closing price of Rs 593.10 on BSE.

However, the stock has fallen 22 per cent in a year and gained 13.88 per cent in 2023. Market cap of Paytm rose to Rs 39,193 crore on BSE. Total 2.20 lakh shares of the firm changed hands amounting to a turnover of Rs 13.17 crore. The stock hit a 52-week high of Rs 844 on August 8, 2022 and a 52-week low of Rs 439.60 on November 24, 2022.

In terms of technicals, the relative strength index (RSI) of Paytm stands at 46.7, signaling it's neither trading in the overbought nor in the oversold territory. The stock has a beta of 0.9, indicating low volatility in a year. Shares of Paytm are trading higher than the 50 day and 100 day moving averages but lower than 5 day, 20 day and 200 day moving averages.

Paytm's Merchant Payment Volumes (GMV) for the quarter-to-date (January and February 2023) stood at Rs 2.34 lakh crore ($28.3 billion), an on-year growth of 41 percent.

"Number of merchants paying subscription for payment devices like Soundbox has reached 64 lakh as of February 2023," the company said.

In the third quarter of the current fiscal, the payment gateway services provider turned positive at the operating level three quarters ahead of its guidance. It reported EBITDA before ESOP of Rs 31 crore in Q3FY23. The firm also narrowed its Q3 loss to Rs 392 crore for the quarter ended December from Rs 779 crore a year ago. Revenue of the SoftBank-backed firm rose 42% to Rs 2,062 crore in Q3FY23 as against Rs 1,456 crore in Q3FY22.

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