Paytm shares hit an all-time low today. Should you buy the stock now?
Premium- Paytm share price is now down over 53% from its initial public offering (IPO) issue price of ₹2,150
Shares of Paytm slipped to an all-time low of ₹990 on the BSE by falling over 4% in Wednesday's trading session. The stock of the digital payments and financial services firm is now down over 53% from its initial public offering (IPO) issue price of ₹2,150 after its dismal listing and a spate of bearish views.
“We expect Paytm stock to remain remain under pressure especially with the global correction in consumer tech stocks that are not profitable. This segment is most vulnerable to selloff due to interest rate hikes. We don't expect the stock to find a bottom in a hurry. We don't think it is an opportune time for even long term investors to bottom fish in the stock," said Abhay Agarwal, Founder and fund manager at Piper Serica, SEBI Regd. PMS.
One 97 Communications Ltd, Paytm’s parent company, raised $2.5 billion in its IPO, but a 27% plunge in its November 18, 2021 debut made it one of the worst initial showings by a major technology firm since the dot-com bubble era of the late 1990s.
“Paytm share price may touch the level of 950 in next trading sessions and remain in consolidation mode till some fresh volumes build up. The selling pressure in Paytm is catastrophic and it is well supported by the overall market sentiments. We expect the stock to be in the red zone till some positive development in the stock," said Ravi Singh, Vice President and Head of Research-Share India.
The company recorded over 4-fold jump in loan disbursals during the October-December 2021 period with 44 lakh loans worth ₹2,180 crore disbursed from its platform as against 8.81 lakh loans worth ₹470 crore in the year-ago period.
During the quarter ending September, Paytm's net losses increased marginally to ₹473.5 crore from from ₹436.7 crore in the year-ago quarter. Its revenue from operations grew 64% year-on-year (YoY) to ₹1,090 crore. The company is yet to release its earnings for the third quarter (Q3FY22).
Ravi Singhal, Vice Chairman of GCL Securities has recommended to Buy the Paytm stock near ₹800 with keeping target prices of ₹1300,1700 and stop loss of ₹666.
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The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
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