Stocks belonging to Paytm, India’s leading digital payment namesake, soared on the stock market on Tuesday when the company’s stock gained favour due to a positive development in the market. Indeed, the stance of renowned Wall Street broker Yes Securities was changed from neutral to buy, and the price target was hiked from Rs 350 to Rs 505 per share, kicking off today’s session positively.
At 11:40 a.m., Paytm’s stock price moved up by 4.96% to the BSE to close at Rs 408.50. This surge occurred resulting from the stock’s upward movement of over 5 percent in the preceding two trading sessions, undoubtedly an indication of a very strong upward momentum.
The decision of the agency to upgrade its security rating was partly because, in recent times, the company’s income had not been dependent on the wallet business, and it more recently received approval from the National Payments Corporation of India (NPCI). Thus, by approving Paytm, the multibank model of the Unified Payments Interface (UPI) as one of the TPAPs, Paytm can enable inter-transaction among different payment methods in the country.
By the brokerage company mentioning the importance of such approval, investors could be confident that Paytm would be able to continue its UPI services with no obstacles in the way and understand that the company had managed its customers’ losses successfully after they had suffered from reputation loss and confusion following RBI’s actions against Paytm Payments Bank Limited (PPBL).
If UPI transactions on Paytm were 14% lower in February 2024, then this figure would only amount to approximately 10% with the necessary adjustments.
Thanks to the RBI’s resolution with PPBL, which did not cause a major disruption of Paytm’s operations starting March 15, investors are showing more confidence in Paytm’s stock. Despite the new stock’s performance, which fell 37% for more than a year, recent improvements show that the stock is headed in the right direction.
While sharing the values of Paytm, performance has been outstanding. In the past five trading sessions, it has gained over 12% and, in a month, nearly 13.5%. Granting credit to this bullish trend, analysts believe that the company’s performance may stay on the surge as its payments and other product lines maintain flawless operation.
It is good to emphasize that a couple of brokers who de-rated Paytm right after implementing RBI’s action on PPBL have not reversed their stance on the company’s growth prospects. These organizations’ fresh outlooks, bullish, diluted, or negative, will impact Paytm’s future share price trajectory.
