Paytm Shares Rebound After Three Days Of Massive Fall, Soar 7 Per Cent

Over the past three days, Paytm had witnessed a sharp decline of over 42 per cent, resulting in a market valuation loss of Rs 20,471.25 crore, primarily triggered by regulatory actions from the RBI

The RBI ordered Paytm Payments Bank to cease further deposits, credit transactions, and top-ups on customer accounts, prepaid instruments, and cards for toll payments after February 29.

Source : Getty

In a positive turn of events, shares of One97 Communications Ltd, the parent firm of the Paytm brand, rebounded this Tuesday morning following three consecutive days of massive decline. The stock surged by 7.79 per cent to reach Rs 472.50 on the BSE, despite initially weak trading conditions. On the National Stock Exchange (NSE), the stock experienced a similar upward trend, climbing by 7.99 per cent to Rs 473.55.

At 3.15 pm on Tuesday, shares of Paytm were trading at Rs 454.00 apiece, up 3.57 per cent on the BSE.

Over the past three days, Paytm had witnessed a sharp decline of over 42 per cent, resulting in a market valuation loss of Rs 20,471.25 crore, primarily triggered by regulatory actions from the Reserve Bank of India (RBI). Notably, One97 Communications Ltd's shares had hit their lower circuit limit just the previous day.

The RBI, in its recent crackdown, issued directives to Paytm Payments Bank Ltd (PPBL), a subsidiary of One97 Communications Limited, instructing it to cease further deposits, credit transactions, and top-ups on customer accounts, prepaid instruments, and cards for toll payments after February 29.

It's crucial to recognise that PPBL is closely associated with One97 Communications Ltd, with the latter holding 49 per cent of the paid-up share capital directly and through its subsidiary. Vijay Shekhar Sharma, the founder and CEO, retains a 51 per cent stake in the bank, emphasising the intertwined nature of these entities.

Meanwhile, Vijay Shekhar Sharma engaged in talks with the RBI, seeking to address regulatory concerns following recent curbs imposed on its banking affiliate, sources familiar with the matter told news agency Bloomberg. Sources close to the discussions said that Paytm is actively working towards resolving the RBI's regulatory concerns and has requested an extension beyond the February 29 deadline.

Wheras, One97 Communications denied any reports of the ED starting a probe against the fintech firm, its associates, or its founder and CEO, Vijay Shekhar Sharma. The company in a clarification via a regulatory filing on Sunday refuted media reports claiming a probe into the firm regarding money laundering concerns after the RBI’s latest action against the company.