Paytm under Scrutiny Post Dent in Stock Prices

Paytm had a stellar debut in its IPO this year, which this company’s CEO expected would rival Coal India’s in 2010. One97Communications Ltd. raised around USD 2.5 billion in the Paytm IPO.

The initial public offer opened for subscription on 8 November 2021 and closed on 10 November 2021. The price band of that IPO was Rs. 2080 to Rs. 2150 for each equity share.

However, that did not lead to a good or moderate debut on Dalal Street. Post debut on the stock exchanges, these stocks dipped 27% on Thursday, 18 November 2021. For more details regarding the same, take a look below!

Key Highlights from the Flop Show by Paytm

• Post its shocking and scandalous debut on the stock markets, Paytm’s parent company, One97 Communications Ltd., is being heavily criticized by investors and is suffering from the ire of retail investors because of this dip in share price.
• However, analysts say that stock prices will not go down much as institutional investors did the majority of the subscription.
• Moreover, Paytm released several financial details for October. Gross merchandise rose to $11.2 billion, which is a rise of 131%. Further loan disbursals, which experts reckon is the clear indicator of the fortunes of this company, rose more than 400% to Rs. 6.27 billion.

All frenzy behind Paytm’s stellar IPO was quickly dashed on the bourse as the stock price dipped a quarter of its list price value. It was among the worst debuts by a technological company on the bourse and created widespread dissatisfaction among analysts and experts alike.

Bottom Line

Earlier, analysts viewed Paytm’s IPO as one of the best. They considered it as an indicator that foreign investors were looking to India.

However, it proved to offer nothing substantial after hitting the stock market. Critics of the frenzy surrounding Paytm had warned that the revenue of this company had fallen 10% amid the intensifying competition.

Frequently Asked Questions

1. Which were the banks managing Paytm’s IPO?

Ans. The banks which managed Paytm’s IPO are:

• Morgan Stanley
• Goldman Sachs Group Inc.
• JPMorgan Chase & Co.
• ICICI Securities

2. How much have retail investors lost on the Paytm IPO?

Ans. Retail investors had heavily invested in the stocks of Paytm. However, they saw a 35% dip in their value in just 2 trading sessions.

3. At what value did the stock dip on Monday 22 November 2021?

Ans.  Price of a share dipped to Rs. 1359.6.

4. When was Paytm Established?

Ans. Paytm was established in August 2010.

5. Who is the CEO of Paytm?

Ans.  The CEO of Paytm is Vijay Shekar Sharma.