One 97 Communications, the parent company of payments platform Paytm, on Wednesday, said their business fundamentals remain robust and there is no information/announcement which may have a bearing on the price/volume behaviour of the stock which is yet to be disclosed to the bourses.
The shares of Paytm have witnessed a steep fall this month, declining nearly 32 per cent to Rs 543.90 apiece on the BSE as of Tuesday.
It further declared that the company has made all necessary disclosures to the stock exchanges within the stipulated timeline.
In a filing to the BSE, the company said, “We would like to reiterate that the company is committed to comply with the Listing Regulations and any information/ announcement, likely to have bearing on the price/ volume of the shares of the Company would be disclosed, from time to time, to the Stock Exchanges within stipulated timeline.”
Paytm’s announcement was in response to a query by the BSE. Asia’s oldest stock exchange on Tuesday had sought clarification from One 97 Communications with reference to the significant movement in the stock price, in order to ensure that investors have the latest relevant information and to safeguard the interest of the investors.
Paytm shares fall 75% since IPO launch
Ever since it made a weak debut in the stock market in November last year, Paytm shares have witnessed a significant fall, declining nearly 75 per cent from its offer price to an all-time low of Rs 541 apiece on the BSE as of Tuesday.
Earlier this month, the Reserve Bank of India (RBI) directed Paytm Payments Bank to stop onboarding new customers with immediate effect and conduct a comprehensive audit of its IT system, citing “material supervisory concerns”. Since the announcement of this measure by the central bank, the stock as crashed over 30 per cent.
What should investors do?
Commenting on the recent developments surrounding Paytm, Ravi Singh, vice president and head of research at Share India Securities said, “RBI’s recent ban on Paytm on adding new customers due to likely gaps in its technology systems hurts the business sentiments severely. The stock has reflected the immediate negative effect and a massive sell off triggered with a frail probability of rebound. However, Paytm has already onboarded a very large customer base onto the payments bank but the ban will affect their chances of upgrading to a small finance bank.”
He noted that due to the negative developments, Paytm stock is in continous downtrend and may touch the levels of Rs 500-450 in the near term. He said that investors must avoid this stock till the sentiments stabilises.