Paytm’s Poor Run On Dalal Street Continues, Shares Tank 13%

The market cap of the Ant Group-backed company, which remained above the Rs 1-lakh crore mark on the listing day, fell to Rs 88,184 crore in early trade on Monday

Representational image | Photo: Getty

New Delhi: Shares of Paytm, listed as One 97 Communications, plunged 13.03 per cent after the day’s trade on the BSE on Monday. On the NSE, the stocks were down 12.74 per cent. 

The stocks dipped as much as 17.97 per cent in the intra-day trading on the BSE, however, during the latter part of the day it recovered and hovers around 14 per cent before finally getting settled at 1,360.30, down 203.85 points. 

The digital payments company made its worst markets debut on Thursday as its shares fell around 27 per cent after the country’s largest-ever initial public offering (IPO). Paytm’s IPO was subscribed 1.89 times last week.

The market cap of the Ant Group-backed company, which remained above the Rs 1-lakh crore mark on the listing day, fell to Rs 88,184 crore in early trade on Monday.

According to market analysts, concerns over valuation weighed on the stock.

Paytm was hitting the headlines for it being the biggest IPO in the country, however, the buzz could not be sustained it seems. Earlier there were some expectations that Paytm’s market debut could underwhelm, the steep plunge on Thursday was surprising.

The company reported a loss of Rs 3.82 billion ($51.5 million) in the quarter ended in June, wider than a loss of Rs 2.84 billion for the same period last year.

Vijay Shekhar Sharma, founder and CEO of One97 Communications, the parent firm of Paytm, was visibly crying with joy at the opening ceremony on Thursday, later told Reuters that he was unperturbed by the slide and did not regret listing in India.

Sharma, who holds 9.1 per cent stake in the firm or near six crore equity shares and 2.1 crore options, saw his net worth erode from $25i billion IPO value to $781 million as of Monday morning trading.

“One day does not decide what our future is,” he said. “It is a new business model and it takes a lot for somebody to understand it straightforward... there is a lot for us to bring to the markets and the market participants,” Sharma had said.