Paytm Shares Hit All-Time Low as Sell-Off Continues
The sell-off in Paytm shares has reached a new low, with the stock hitting an all-time low of ₹317.15 per share in today’s trading session. This marks the 10th consecutive session of losses for the stock, making it the longest losing streak since its listing in November 2021.
One of the key factors contributing to the downward spiral of Paytm’s stock is the reported exercise of loan guarantees by Aditya Birla Finance, a significant lending partner for the company. This action comes after repayment defaults from customers, signaling challenges in the company’s lending business.
In addition to Aditya Birla Finance, Piramal Finance and Clix Capital have terminated their partnerships with Paytm, further adding to the company’s financial woes. These decisions are said to be a result of the central bank’s ban on Paytm Payments Bank and a broader slowdown in unsecured consumer lending.
The recent resignation of Paytm’s President and Chief Operating Officer, Bhavesh Gupta, has also contributed to the negative sentiment surrounding the stock. Gupta’s departure, citing personal reasons, follows the resignation of Surinder Chawla, Chief Executive Officer and Managing Director of Paytm Payments Bank, earlier in April.
Furthermore, the decline in the company’s Unified Payments Interface (UPI) transactions for the third consecutive month in April has added to the challenges Paytm is facing. The company’s market share in the UPI ecosystem has contracted, with a reported 8.4% market share in April, down from 10.8% in February.
With the stock trading at an 85.25% discount compared to its IPO price, investors who participated in the initial public offering are facing significant losses. Despite these challenges, Paytm’s founder and CEO, Vijay Shekhar Sharma, remains a major stakeholder in the company.
As Paytm continues to navigate through these turbulent times, investors and analysts are closely monitoring the company’s financial performance and strategic decisions. It remains to be seen how Paytm will address the issues plaguing its business and regain investor confidence in the future.