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Paytm shares take a U-turn; up 41% from record lows

Paytm shares take a U-turn; up 41% from record lows

On Monday, the stock tanked 19 per cent to hit an intraday low of Rs 1,271 on the BSE but then took a U-turn and rose 10 per cent to hit an intraday high of Rs 1,490.95 on Tuesday.

Paytm shares take a U-turn; up 41% from record lows Paytm shares take a U-turn; up 41% from record lows

In a major relief for investors, the shares of fintech giant Paytm (listed as One 97 Communications) rose 20 per cent to hit an intraday high of Rs 1,790 on the BSE on Wednesday. The market cap of the firm rose to Rs 1,13,652.10 crore.

The stock is now up over 40 per cent from its record low. On Monday, the stock tanked 19 per cent to hit an intraday low of Rs 1,271 on the BSE but then took a U-turn and rose 10 per cent to hit an intraday high of Rs 1,490.95 on Tuesday.

Paytm initiated its journey as a public company with a 27 per cent fall over its IPO (initial public offering) price on November 18. The scrip listed at a discount of 9.30 per cent at Rs 1,950 on the NSE against the issue price of Rs 2,150 per share.

However, it managed to cross the milestone of Rs 1 lakh crore market capitalisation during its market debut. The digital payments firm reached a market cap of Rs 1.19 lakh crore on the BSE during its tepid market listing.

Brokerage firm Macquarie has an 'underperform' rating on the stock with a target price of Rs 1,200 per share. "Paytm’s valuation, at around 26x FY23E Price to Sales (P/S), is expensive especially when profitability remains elusive for a long time," it said in a note.

"Existing investors can hold the stock for now and the high-risk appetite investors can take a position in a staggered manner," Kranthi Bathini, equity strategist at WealthMills Securities, told BusinessToday.in.

On Sunday, the financial services firm announced that it saw a 418 per cent year-on-year (YoY) increase in value of loans disbursed through it in October at Rs 627 crore, while the number of loans disbursed grew 472 per cent YoY to 13 lakh.

The recently-listed company also said that its board will meet on November 27 to consider and approve the financial results for the quarter and half year ended September 30, 2021.

Meanwhile, Paytm's subsidiary Paytm Money has rolled out a 'Margin Pledge' feature to help users access new trading opportunities by leveraging existing portfolios. The feature allows users to pledge their stocks in return for a collateral margin and can then be used for trading in stocks, ETFs, futures and options.

The feature that is currently accessible to select users is available on Android and web versions and will be on Apple iOS soon.