Paytm shares fell after four sessions today, here’s why

Shares of Paytm (listed as One97 Communications) fell after four sessions of gains today. The stock, which rose 21% in the last four sessions, fell 3.74% to Rs 380.45 today. The decline in the stock came after foreign brokerage Goldman Sachs assigned a 'neutral' rating on the stock. It also trimmed the target price to Rs 450 from Rs 860 per share earlier. The adjustment reflects the potential loss of market share in the payments sector.

Goldman Sachs also sees a slowdown in lending in the near term as a consequence of a recent RBI directive that imposed strict restrictions on Paytm Payments Bank (PPBL).

Revenue and adjusted EBITDA estimates for FY24E-26 have been trimmed by up to 36 percent and 80 percent, respectively. FY25 revenues are expected to fall 21 percent on-year, compared to the previous projection of 16 percent growth, said Goldman Sachs.

In the current session, market cap of Paytm fell to Rs 25,494 crore on BSE. Total 13.92 lakh shares of the firm changed hands amounting to a turnover of Rs 54.48 crore. The stock fell to a 52-week low of Rs 318.35 on February 16, 2024. 

At 10:29 am, the stock gained 1.59% to Rs 401.55 on BSE. It has lost 34.09% in a year and fallen 38 per cent in 2023.   

The stock has a beta of 0.2, indicating low volatility in a year.

In terms of technicals, the relative strength index (RSI) of Paytm stands at 33.4, signaling it's trading neither in the oversold nor in the overbought territory. Shares of Paytm are trading lower than the 20 day, 50 day, 100 day and 200 day but higher than the 5 day and 10 day moving averages.   

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