Paytm’s Stock Surges as RBI Extends Deadline

For the last few trading sessions, the stock prices of One 97 Communications, the parent company of Paytm, have been consistently hitting upper circuit limits, marking a 5% rally for the fourth consecutive day and reaching ₹ 395 per share. 

In just the last four days,” The stock has seen an impressive gain of 21%”. This surge in stock price may be due to ”The Reserve Bank of India’s (RBI) decision to extend the deadline for Paytm Payments Bank (PPBL) to complete deposits, credit transactions, or top-ups until March 15.”

Paytm has recently relocated its nodal account to Axis Bank due to the concerns about possible disruptions in merchant payments. This strategic move will ensure that merchants can continue to accept digital payments through the Paytm QR code or card machine. Paytm has also announced that ”customers will not be able to deposit funds into their Paytm Payments Bank accounts after March 15 but can continue to use withdraw, and transfer funds.” 

Vijay Shekhar Sharma, the founder and CEO of Paytm, reassured users that ”vital services such as Paytm QR, Soundbox, and card systems will be available beyond March 15.” 

Meanwhile, financial firm Bernstein gave an ‘outperform’ rating to Paytm, setting a target price of ₹600 per share. They believe that RBI’s actions mainly target PPBL and will not disrupt other essential functions of Paytm.

Jefferies, a global brokerage firm, has decided to ”suspend coverage of Paytm until the market shows more stability.” Despite the stock’s upward trend, Paytm appears to be successfully navigating regulatory changes by implementing strategic moves and providing reassurances to its users.