
One 97 Communications Ltd (Paytm) on Tuesday saw its shares rising 5 per cent for the third straight session after the fintech giant said its founder Vijay Shekhar Sharma stepped down as non-executive chairman of Paytm Payments Bank (PPBL) to aid the payments bank in the transition. The Paytm stock hit its 5 per cent circuit limit at Rs 449.30 on BSE. That said, the scrip soon slipped into the red. The stock was, however, trading 0.57 per cent lower at Rs 425.50 as the session progressed, after foreign brokerage Macquarie maintained its 'underperform' call on the sock, with a target of Rs 275.
In a filing to BSE, Paytm said PPBL's future business would be led by a reconstituted board, which would be led by ex-Central Bank of India Chairman Srinivasan Sridhar, retired IAS Debendranath Sarangi, former Executive Director of Bank of Baroda Shri Ashok Kumar Garg, and retired IAS Rajni Sekhri Sibal. The stock has risen 33 per cent from a low of Rs 318.35 hit on February 16.
Macquarie reportedly said Sharma was trying to salvage some value from PPBL and by stepping down from the board he was sending a message to the RBI that he is willing to give up control of PPBL. Macquarie said the RBI may have to offer some relaxation to PPBL in order to ensure its survival but the broking firm does not expect the central bank to authorize any related party transactions between Paytm and PBBL in the future, ET NOW reported.
“OCL supports PPBL’s move of opting for a board with only independent and executive directors by removing its nominee. The Company has been separately informed that Vijay Shekhar Sharma has also resigned from the Board of Paytm Payments Bank to enable this transition. PPBL has informed us that they will commence the process of appointing a new Chairman,” Paytm said in a BSE filing.
The central bank last week asked the National Payments Corporation of India (NPCI) to evaluate a request from Paytm to become a third party application provider. This came after the RBI stopped PPBL from taking any fresh deposits or credit transactions or top-ups in any customer accounts, prepaid instruments, wallets, FASTags, and NCMC cards.
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