In a remarkable turn of events, One 97 Communications, the parent company of Paytm, has extended its winning streak for a second consecutive day, with stock prices rising nearly 3% during intraday trading. As of April 2, shares reached a notable high of ₹822.70, marking a six-week peak. This surge comes after a 25% increase over just 15 trading sessions, positioning the stock close to its previous high of ₹823 from February.
Partnership with GHMC Boosts Paytm’s Market Position
Today’s rise in Paytm’s stock can be attributed to an exciting new partnership with the Greater Hyderabad Municipal Corporation (GHMC). This collaboration aims to enhance property tax collection by introducing over 400 Paytm All-In-One EDC devices. With these devices, citizens can conveniently pay their property taxes using credit and debit cards, as well as Paytm’s innovative QR codes, eliminating the need for cash or checks.
- The card machines are seamlessly integrated with the GHMC app.
- This integration allows officials to verify outstanding dues and process payments instantly, providing immediate confirmation slips for users.
Regulatory Approvals and Future Potential
In a significant development on March 18, Paytm’s subsidiary, Paytm Money, received approval from the market regulator, enabling it to operate as a research analyst. This certification allows Paytm Money to offer SEBI-compliant research services, including valuable investment insights and comprehensive research reports.
According to JM Financial, a prominent brokerage firm, Paytm’s recovery from past disruptions has been promising. They foresee three potential regulatory changes that could significantly impact the company in the upcoming fiscal year:
- Implementation of Merchant Discount Rate (MDR) for larger merchants’ UPI payments.
- Lifting the restrictions on Paytm Payments Bank.
- Approval for a Payment Aggregator (PA) or Payment Gateway (PG) license.
Analyst Insights and Stock Predictions
JM Financial maintains a ‘Buy’ rating on Paytm, projecting a target price of ₹1,010 by March 2026. They believe that the current market price, reflecting a 25x FY27E Adjusted EBITDA multiple, shows limited downside risk. However, there could be substantial upside potential if any of the anticipated regulatory changes occur, possibly increasing FY27 EBITDA estimates by about 35%.
Technical Analysis: Approaching ₹1,000
After a strong recovery in March, when shares gained 9.58%, analysts predict that Paytm’s stock could soon approach the ₹1,000 mark. Anshul Jain, the Head of Research at Lakshmishree Investment and Securities, notes a bullish trend forming in the stock, characterized by a cup and handle pattern on daily charts. This pattern suggests a potential breakout, particularly if the stock closes above ₹825, which could lead to a rally towards the previous swing high of ₹998.
As investors keep a close eye on Paytm’s performance, the upcoming weeks may reveal whether the stock can maintain its momentum and reach new heights.
