Paytm shares fall by more than 13% as anchor investors’ lock-in period expires

Paytm shares fell more than 27% in the country’s largest public offering last month. Since the IPO on November 22, the stock has suffered losses in 13 of the 18 sessions. Paytm, which counts SoftBank and Ant Group among its backers, raised $ 2.5 billion in its IPO, of which $ 1.1 billion was from institutional investors.

Parth Nyati, founder, Tradingo at Paytm said, “after a sharp drop after the lock-in period ended for anchor investors, Paytm finds buyer interest at lower levels, but 1700 can act as a supply point and it can remain in the 1300 -1700 range until the market decides its true value, while if it manages to stay above the 1700 level, it may see further buying interest, it may find strong support between the 1200-1300 range. “

“Paytm’s biggest strength is its huge customer base and strong brand positioning, but companies with low access barriers lack a clear moat. Paytm will use its strengths to get into new businesses or to create moats. If Paytm manages to emerge as a leader in a particular company, it will be possible to expect purchase interest rates at lower levels, otherwise it may take many years to reach its highest valuation, “he added.

This happens only a few days after the digital payment company announced it over doubling its gross value to approx. ₹1,66,600 crore in the first two months of the third quarter of this financial statement, driven by a sharp increase in loan disbursements. One97 Communications Ltd, the parent company that owns and operates the Paytm brand, had registered GMV (gross merchandise value) at ₹NOK 72,800 million in the corresponding period a year ago.

Paytm refers to GMV as the value of the total payments made to merchants through transactions on their app, through Paytm payment instruments or through their payment solutions, over a period of time. It excludes any consumer-to-consumer payment services such as money transfers.

The value of the disbursed loan increased by 375% on an annual basis (year-on-year) to ₹13,200 crore (USD 178 million) in the first two months of the quarter from ₹280 million kroner. Paytm had a 36 percent growth in monthly transaction users (MTUs) of $ 6.32 in the reported period, from over $ 4.66 average MTUs in the first two months of the same quarter a year ago.