Paytm slumps after block deals

One 97 Communications (Paytm) dropped 8.83% to Rs 548.45 on high volumes after the counter reported multiple block deals in initial trade today, 17 November 2022.

The stock was currently hovering near its record low of Rs 511 hit on 12 May 2022.

On the BSE, 30.51 crore shares of the company were traded on the counter so far as against an average trading volume of 93,408.94 shares in the past three months.

On the NSE, 4.06 crore shares changed hand on the counter so far compared with an average trading volume of 11.58 lakh shares traded in the past three months.

The media reported that Japanese conglomerate SoftBank Group plans to sell 2.9 crore shares, or 4.5%, of Paytm through a block deal on Thursday (17 November 2022). The price range for the sale has been set at Rs 555-601. The sale will likely fetch SoftBank at least Rs 1,628.9 crore ($200 million).

The lower end of the price band is a 7.74% discount to Wednesday's close price of Rs 601.55 on the BSE.

The sale follows the end of one-year mandatory lock-in for pre-IPO investors in Paytm. The stock entered the bourses on 18 November 2021. It was listed at Rs 1955, a discount of 9.07% compared with the initial public offer (IPO) price of Rs 2150. The IPO of Paytm was subscribed 1.89 times. The issue opened for bidding on 8 November and it closed on 10 November. The price band of the IPO was fixed at Rs 2080 to Rs 2150 per share.

As of 30 September 2022, SoftBank held a 17.45% stake in Paytm through SVF India Holdings (Cayman).

SoftBank had invested $1.6 billion in Paytm and had sold a partial stake worth $220-250 million in the IPO last year.

One 97 Communications is the digital financial services firm which operates under the Paytm brand. Paytm is India's payment super app offering consumers and merchants comprehensive payment services.

On a consolidated basis, One 97 Communications' revenue surged 76.2% to Rs 1914 crore in Q2 September 2022 over Q2 September 2021. The revenue was driven by increase in merchant subscription revenues, growth in bill payments due to growing MTUs (monthly transacting users) and growth in disbursements of loans through platform. However, the company's consolidated loss widened to Rs 571.10 crore in Q1 June 2022 from net loss of Rs 472.90 crore a year ago.

Powered by Capital Market - Live News