Shares of One 97 Communications, Paytm's parent, continued their downward trend for the third straight session on Wednesday to hit fresh one-year lows. The stock further plunged 7.70 per cent to hit a record low of Rs 440.35, but no near-term relief is likely for the stock. Technical charts paint a grim outlook, with analysts suggesting Rs 350 and even sub-Rs 300 targets.
On Wednesday, a total of 17.16 lakh shares changed hands, amounting to a turnover of Rs 80.02 crore. The company's market capitalisation (m-cap) stood at Rs 29,361.31 crore, down more than Rs 90,000 crore from its peak value of around Rs 1.2 lakh crore.
Ravi Singal, CEO of GCL Securities said, "Investors must wait. The stock will take time to reach the bottom. It can test Rs 350 levels after some consolidation. It is possible to accumulate near these levels in the long term."
Manoj Kumar Dalmia, Founder and Director of Proficient equities Private Ltd, said, "Paytm shares look weak on the weekly timeframe and might continue their downward journey till a level of Rs 292. Investors can avoid buying this stock for now as they might suffer further losses."
Paytm finally settled 5.20 per cent lower at Rs 452.20 today. The stock has plunged nearly 28 per cent over the past month. On a year-to-date (YTD) basis, it has declined 66 per cent.
Ravi Singh, Vice-President and Head of Research at Share India, said, "Paytm share price may continue its selling spree amid the continuous dumping of shareholdings by large funds. This selling pressure by pre-IPO investors may not stop soon."
The stock saw an 11 per cent drop in the previous session after Macquarie analysts suggested that Jio Financial Services can pose a "significant risk" for the digital payments firm. Reliance Industries (RIL) recently announced that it would demerge its financial services business and rename it Jio Financial Services (JFS).
Jio Financial Services, Macquarie said, has articulated that it plans to launch a consumer and merchant lending business based on proprietary data analytics to complement and supplement the traditional credit bureau-based underwriting. Macquarie said the focus seems to be on consumer and merchant lending, which is the mainstay of NBFCs like Bajaj Finance and fintechs like Paytm.
"Among NBFCs (non-banking financial services)/fintech, Bajaj Finance and Paytm could be the most at risk," Macquarie Capital Securities (India) Pvt Ltd stated in its report. In contrast to the massive hit in Paytm stock, Bajaj Finance traded higher in today's deals.
Paytm made a tepid debut at the exchanges in November last year. Since then, the shares have mostly recorded losses.
At Wednesday's low levels, the stock was down 79.52 per cent from its IPO issue price of Rs 2,150.
Meanwhile, Indian equity benchmarks settled on a higher note for the second straight session today, led by gains in state-owned lenders.
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