Paytm Shares Swing As Historic Profitability Fails To Impress Investors
At Intraday the stock rose to Rs 1,090 but later gave up some gains to trade 0.77% up at Rs 1,059 in early trade.
Shares of One97 Communications Ltd., the parent company of Paytm, swinged on Wednesday after the fintech firm reported its first quarterly net profit since going public in 2021.
At Intraday the stock rose to Rs 1,090 but later gave up some gains to trade 0.77% up at Rs 1,059 in early trade, buoyed by investor optimism following a strong set of earnings for the April–June quarter of FY26.
Paytm reported a net profit of Rs 122.5 crore for the June quarter, a sharp turnaround from a Rs 540 crore loss in the previous quarter. This marks a milestone for the company, which has been under pressure to demonstrate profitability since its IPO. The company attributed the improved performance to a combination of lower employee stock ownership plan (ESOP) expenses, robust growth in its financial services distribution business, and increased other income.
Operationally, the company posted an Ebitda of Rs 71.5 crore, compared to a loss of Rs 88.6 crore in the preceding quarter. Gross merchandise value (GMV) rose 27% year-on-year to Rs 5.4 trillion, reflecting strong transaction volumes across its platform.
Jefferies upgraded Paytm to a “Buy” rating and raised its target price to Rs 1,250, citing a strong Ebitda beat and improved operating leverage.
Citi maintained its “Buy” rating and increased its price target to Rs 1,215. The firm highlighted a “significant beat” on adjusted Ebitda, which came in at Rs 1,000 crore versus its estimate of Rs 400 crore.
Bernstein retained its “Outperform” rating with a target price of Rs 1,100. The brokerage emphasised that the profit was achieved without any one-off gains, driven instead by a sharp drop in ESOP costs and reduced marketing expenses.
