08/12/2022

After SoftBank Stake Sale, Paytm Shares Drop Over 10%: 10 Points

Paytm shares tank, analysts, however, expect buying interest soon

Shares of Paytm’s parent form One97 Communications tanked over 10 per cent in the stock market today.

Here Are 10 Facts About The Fundamentals Of The Stock:

  1. Early investor Softbank selling a 4.5 per cent stake in the company was a trigger for the heavy sell-off witnessed today; Masayoshi Son-led SoftBank through SVF India Holdings held 17.45 per cent before selling 4.5 per cent on Wednesday.

  2. Softbank sold a part of the stake at Rs 555 – Rs 601 range which at the lower end was at a discount to its closing price on Tuesday.

  3. Most new-age tech stocks have been at the receiving end of investor fury. Paytm is among the worst hit in this lot.

  4. Analysts have attributed the opaque revenue model of these companies and their high valuations as the prime reasons for investor fury.

  5. Expiry of the lock-in period for pre-IPO investors is another reason for Paytm coming under intense selling pressure; As much as 85.76 per cent of the outstanding shares are now free to trade.

  6. When Paytm came up with an Rs 18,300-crore initial public offer (IPO) in November last year, it was billed as India’s biggest issue.

  7. Paytm has lost 58.8 per cent in the year-to-date period. The BSE benchmark index, Sensex, in the same period has gained 4.55 per cent.

  8. Antfin (Netherlands) Holding BV; SVF India Holdings (Cayman) Limited; SAIF III Mauritius Company Limited; Alibaba.Com Singapore E-Commerce Private Limited; SAIF Partners India IV Limited; BH International Holdings are foreign investors Paytm, according to shareholding pattern available on BSE; Canada Pension Plan Investment Board is the foreign portfolio investor (FPI).

  9. Antfin (Netherlands) Holding B.V. is the single largest shareholder with a 24.88 per cent stake; China’s Alibaba Group holds 6.26 per cent; Antfin is the fintech affiliate of Alibaba Group.

  10. Paytm’s consolidated loss has widened to Rs 593.9 crore in the July-September period of this financial year; revenue from operations increased by about 76 per cent to Rs 1,914 crore.

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