Paytm shares rebound 8% from all-time low; here's what tech charts hint at

Shares of One 97 Communications Ltd, Paytm's parent, on Thursday recovered from their lifetime low levels to settle in the green. The stock fell 2.35 per cent in early trade to hit a record low of Rs 310. It later rebounded 7.52 per cent from its all-time low level to settle at Rs 333.30. On a closing basis, the counter's uptick was of 5 per cent today. Despite the mentioned rise, the scrip has declined 48.46 per cent on a year-to-date (YTD) basis.

Paytm's president and chief operating officer (COO) Bhavesh Gupta has recently resigned. Gupta has moved to an advisory position, as a part of overall organisational restructuring. He will continue to support Paytm as an advisor in the CEO office after May 31, 2024, Paytm informed exchanges.

The stock has been under tremendous pressure since Reserve Bank of India (RBI) announced restrictions on Paytm Payments Bank's operations amid persistent non-compliances and continued material supervisory concerns.

On technical setup, the counter traded lower than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-day and 200-day simple moving averages (SMAs). The stock's 14-day relative strength index (RSI) came at 38.67. A level below 30 is defined as oversold while a value above 70 is considered overbought.

AR Ramachandran from Tips2trades said Paytm looked slightly bullish but also oversold on daily charts with strong support at Rs 310. A daily close above resistance of Rs 352 could lead the stock to an upside target of Rs 409 in the near term, he added.

Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking, said, "The stock can slip towards Rs 280 level in the near term. Hence, caution is advised."

Anshul Jain, Head of Research at Lakshmishree Investment and Securities, said, "For Paytm, a potential bounce-back to around Rs 370 level might offer temporary relief. We recommend a cautious approach, advocating for selling on rallies with a strict stop loss of Rs 255."

The company's stock has a negative price-to-equity (P/E) ratio of 19 against a price-to-book (P/B) value of 1.70. Earnings per share (EPS) stood at (-)17.54 with a return on equity of (-)8.97.

Bourses BSE and NSE have put the securities of Paytm under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.