Paytm share price: One 97 Communications stock crashes over 13% as RBI directs payments bank arm to stop onboarding new customers
Paytm share price: Shares of One 97 Communications, the owner of payments platform Paytm, fell over 13 per cent to hit their lowest levels in the morning trade on Monday after the Reserve Bank of India (RBI) on Friday 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”.
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The stock fell 13.30 per cent to its all-time low of Rs 672.00 per share on the National Stock Exchange (NSE) while on the BSE, it declined 13.25 per cent to touch a low of Rs 672.10 apiece.
At 11:24 am, the scrip of One 97 Communications was trading at Rs 701.00, down Rs 73.80 (9.53 per cent) while on NSE, it was at Rs 699.35, down Rs 75.70 (9.77 per cent). The market capitalisation of the company stood at Rs 45,461.55 crore, data from the BSE showed.
So far in the intraday trade, over 64.43 lakh shares of Paytm have been traded on the NSE while over 3.23 lakh shares have exchanged hands on the BSE, data from the respective stock exchanges showed.
In a statement released on Friday after market hours, the central bank said, “Onboarding of new customers by Paytm Payments Bank Ltd will be subject to specific permission to be granted by RBI after reviewing report of the IT auditors.”
This action is based on certain material supervisory concerns observed in the bank, it added.
For the year ended March 31, 2021, Paytm Payments Bank, which has the largest scale among all payment banks, had recorded a net profit of Rs 17.88 crore on sales of Rs 1,987.84 crore, according to Paytm’s IPO prospectus. One97 Communications owns 49 per cent equity interest in Paytm Payments Bank, while the rest 51 per cent is owned by Vijay Shekhar Sharma.
Reacting to the fall, Ravi Singh, Head of Research and Vice President at Share India Securities said, “Paytm’s recent ban on adding new customers due to likely gaps in its technology systems is definitely going to hurt the business sentiments. The immediate impact will be negative. However, Paytm has already onboarded a very large customer base onto the payments bank, but the ban may affect their chances of upgrading to a small finance bank. The stock may see more selling pressure and may touch the level of Rs 500 in the medium term.”
He further noted that “The overall market is in correction mode. New-age internet stocks like Zomato, Nykaa, or Paytm are also facing massive selling pressure. This may continue for some more trading sessions. However, a buying opportunity may arise if these stocks fall another 3–5 per cent. Investors may take a fresh entry, keeping a view of the long term.”
