Paytm shares surge 4% to trade near 52-week high level

Shares of One97 Communication, the parent company of Paytm, jumped during the early trading session on Friday. The stock was just shy from its 52-week high mark during the early trading session. Shares of the fintech platform operator have gained more than 10 per cent in the last three weeks. The company is yet to announce Q2 business updates.

Shares of Paytm, extended its gains by more than 4 per cent to Rs 934, before giving up some gains. The stock was hovering near its 52-week high at Rs 939 for the day. The company was commanding a total market capitalization of close to Rs 59,000 crore. The stock has settled at Rs 896.10 in the previous trading session on Thursday.

The rise in Paytm shares was backed by heavy trading volumes in the early session. As much as 3.45 lakh equity shares exchanged hands on BSE as of 11 am, compared to the two-week average of merely 0.90 lakh shares. Similarly, more than 35.27 lakh equity shares worth more than Rs 326 crore were traded on NSE at the same time.

Shares of Paytm have rallied about 115 per cent from its 52-week lows at Rs 439.60. The stock has gained more than 75 per cent in the year 2022 so far, while it has gained about 35 per cent in the last one year. Despite the strong returns, the stock is still 57 per cent below its issue price of Rs 2,150.

Motilal Oswal expects Paytm's operating profitability to increase, driven by improvement in contribution margin & operating leverage in the September 2023 quarter and the company is likely to report a healthy growth in revenue in the previous three months. It has a buy rating on the stock with a target price of Rs 1,000 and will review it after Q2 earnings.

Domestic brokerage firm estimates 2QFY24 GMV to grow 46 per cent on a year-on-year (YoY) basis, while the value of loans disbursed is likely to grow 135 per cent YoY and 16 per cent QoQ to Rs 17,200 crore. "We expect revenue from operations to grow 36 per cent YoY to Rs 2,600 crore, while contribution profit is estimated to grow 72 per cent YoY to Rs 14,500 crore," it added.

 

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