Paytm stock hits 43-mth high on RBI nod to PPSL; brokerages decode strategy

Paytm share price gained 6 per cent today after Paytm Payments Services Limited received in-principle approval from the RBI to operate as an online payment aggregator

Paytm share price today

 

Shares of One97 Communications, the company that operates Paytm, hit a 43-month high of ₹1,171.70 on the BSE today, surging 5 per cent in Wednesday's intraday trade. The rise in Paytm share price came after the Reserve Bank of India (RBI) gave an in-principle approval to Paytm Payments Services Limited (PPSL) to operate as an online payment aggregator.

 

In the past three trading days, Paytm stock has gained 12 per cent, while in the past five weeks, it has soared 31 per cent.

 

Further, Paytm shares were quoting at their highest level since January 2022. The stock has recovered 82 per cent from its March 2025 low of ₹652.30 that it had touched on the BSE. It had hit a record high of ₹1,961.05 on its listing day i.e. November 18, 2021. Moreover, Patym shares touched an all-time low of ₹310 on May 9, 2024. Paytm had allotted shares at an issue price of ₹2,150 in its initial public offer (IPO).  READ STOCK MARKET UPDATES TODAY LIVE

Why is Paytm stock price rising today?

 

Today's rally in the financial technology (fintech) stock came after Paytm Payments Services Limited (PPSL), a wholly owned subsidiary of One 97 Communications Limited, received in-principle nod from the RBI to operate as an online payment aggregator under the Payment and Settlement Systems Act, 2007.

 

"The Reserve Bank of India (RBI) has granted 'in-principle' authorisation to PPSL, vide its letter dated August 12, 2025, to operate as an Online Payment Aggregator under the Payment and Settlement Systems Act, 2007," Paytm said in an exchange filing on Tuesday. CLICK HERE FOR DETAILS

 

The approval marks a significant regulatory milestone for the company and also lifts the ban on on-boarding new merchants, which had been in place since November 2022 when PPSL's earlier application was rejected.

 

Importantly, the approval comes soon after Ant Financial’'s complete exit from Paytm in a clean-out trade, with the sale of its residual 5.84 per cent stake, effectively removing Chinese shareholding from the company's ownership structure.

 

According to analysts, the timing of the RBI's approval suggests that changes in shareholding and a cleaner compliance profile may have been instrumental in facilitating the decision.

 

On August 5, 2025, Antfin (Netherlands) Holding B.V. sold its entire 5.84 per cent stake for around ₹4,000 crore. According to the BSE's bulk deals data, Antfin (Netherlands) Holding B.V. sold 18.64 million shares in two tranches. Antfin (Netherlands) Holding BV is the entity of Chinese technology conglomerate Alibaba Group.  ALSO READ | Honasa Consumer, parent of Mamaearth, zooms 13% post Q1; Buy or sell?

Brokerages on Paytm

 

Paytm has seen a sharp reversal in its earnings since January 2024 with the fintech company reporting PAT profitability in Q1FY26. Furthermore, the improvement in contribution margin (mid-high fifties) along with a controlled rise in indirect expenses can potentially trigger a rapid rise in absolute profits for the company with focus reverting to sustainable growth.

 

"However, the latest development could be a big sentimental trigger as the approval likely becomes a precursor to further regulatory clearances for Paytm," analysts at JM Financial Institutional Securities said.

 

The brokerage values Paytm stock at 40x June 2027 Adjusted Ebitda of ₹1,850 crore to reach June 2026 target price of ₹1,320.

 

"Moreover, there still remains the optionality of further regulatory triggers such as UPI monetisation and Paytm wallet that could each result in c.25-30 per cent rise in our Ebitda estimates," the brokerage firm said in a company update.

 

Meanwhile, post Q1 results, YES Securities maintained its 'ADD' rating on Paytm with a revised price target of ₹1,200.

 

The Management stated that the Payments business is already profitable on a standalone basis without merchant discount rate (MDR) on UPI and will be a large profitability driver when MDR-bearing form factors grow. Net payments margin is going to rise because of rise in credit cards, EMI and loyalty points, the brokerage said.  ALSO READ | NHPC share up 2% post Q1 results; JM Financial says 'buy'; check details 

Emkay Global Financial Services, meanwhile, believes Paytm is executing well on acquiring merchants, leveraging its superior Soundbox products and distributing loans to them. With low penetration of loans, the brokerage firm sees a long growth runway for this business.

 

"Considering cash on books of ₹1,290 crore, the long growth runway for payments and financial services, and the various optionalities (such as BNPL, Wallet, scale-up of Rupay Credit Cards), we believe the risk return is attractive," Emkay Global analysts said with a 'BUY' rating on the stock with a target price of ₹1,350.