Paytm stock: Softbank sells Paytm shares, stake drops to 2.83%

One 97 Communications Ltd (Paytm) shares were reeling under pressure in Thursday's as the Japan-based SoftBank Group has cut its stake in fintech giant to 2.83 per cent from 5.01 per cent earlier, a BSE filing suggested.

Paytm told the stock exchange that SVF India Holdings (Cayman) sold 12,784,787 Paytm shares, which account for 2.17 per cent stake in the Vijay Shekar Sharma-led company. It now owns 18,001,034 shares or 2.83 per cent stake in the fintech company against 31,785,821 Paytm shares, or 5.01 per cent stake, as of December 31.

At 1.56 pm, the Paytm stock was tradinf at Rs 391.05 on BSE, down 3.72 per cent.

The Softbank stake sale came, as concerns linger the fintech could overcome from the RBI regulatory actions only to a limited extent, as the recent developments have created negative sentiment that would drive churn in merchant base.

"We expect revenues to decline 2 per cent YoY in FY25E, from 36 per cent growth in 9MFY24. We expect Paytm to lose 5-7 percentage points of its 25 per cent share in payments industry, driven by loss of wallet (2-3ppt permanent loss) and the rest due to merchant/customer churn. We estimate net payments margin to decline to 6-7 bps range from 7-9bp range," UBS said in a note.

As lenders' confidence has been hit, UBS forecast loan disbursements to decline 14 per cent YoY in FY25E. It expected a smaller 18 per cent decline in cloud and commerce in Q4, given a less
direct impact and 18 per cent YoY growth in FY25E.