Paytm Stock Plunges 9% Today, ‘Buy on Dip’ Investors Left in a Soup as Shares Continue to Fall | India Business News

Paytm share price today: As hopes for a quick resolution to regulatory issues faded, shares of One 97 Communications, the company behind Paytm, dropped by up to 9% to Rs 408 on the BSE on Friday. This decline followed a 10% decrease in the stock’s value on Thursday.
At 3:01 PM, the stock was trading 6.31% lower at Rs 418.45 on the Bombay Stock Exchange.
During the press briefing following Thursday’s monetary policy committee meeting, RBI officials reiterated their firm stance on Paytm, stating that the regulatory action was necessary due to ongoing non-compliance. They emphasised that Paytm had been given sufficient time to address these issues but had failed to take corrective measures.
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RBI Governor Shaktikanta Das emphasised that the restrictions imposed are in proportion to the seriousness of the situation, stressing that factors like systemic stability and depositor’s interests cannot be compromised.
Das was quoted saying that “such restrictions which we impose are always proportionate to the gravity of the situation. All our actions, being a responsible regulator, supervisor, are in the best interest of systemic stability and protection of depositors’ or customers’ interest. These aspects can not be compromised.”
Furthermore, ET reports suggest that RBI will engage with key stakeholders, including the National Highways Authority of India (NHAI) and National Payments Corporation of India (NPCI), to facilitate the transition of merchants and consumers away from Paytm.
In response to mounting pressure, Paytm founder Vijay Shekhar Sharma met with Finance Minister Nirmala Sitharaman earlier this week. It’s understood that she advised him to address the regulatory concerns with the RBI and resolve the flagged non-compliances.
The Paytm founder reportedly requested an extension of the February 29 deadline, along with a transition plan, and outlined ongoing efforts to meet the compliance requirements set by the RBI. There are indications that the regulator is considering revoking the licence of Paytm Payments Bank.
Paytm stock movement
Since the RBI ban was announced on the evening of January 31, Paytm shares have plummeted by 46%. Apart from a brief relief rally on two days, which likely trapped many “buy-the-dip” investors, the stock has been consistently declining, resulting in investor losses amounting to Rs 22,000 crore, the report said.
Market experts caution retail investors against buying into Paytm until regulatory concerns are resolved, advising them to wait for the company to navigate through these challenges successfully.
Sudip Bandyopadhyay from Inditrade Capital likened the situation with Paytm to “trying to catch a falling knife,” a risky endeavour in market terms. He highlighted the significant impact of the RBI’s directives on Paytm’s payments bank operations, leading to widespread uncertainty. Despite ongoing meetings, the approval of remedial actions by the regulator remains uncertain. Bandyopadhyay noted a loss of confidence among customers and partners, with many expressing a desire to disassociate from the platform.
Conversely, global brokerage firm Bernstein suggests a buy-the-dip approach with a target price of Rs 600.

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