The RBI has granted an extension until March 15 for Paytm Payments Bank account holders to transfer their assets and find alternative banking solutions, alongside halting operations.
Following a partnership announcement with Axis Bank for merchant payment settlements, Paytm shares surged by 5% to hit the upper circuit for the second consecutive session on February 19, trading at Rs 358.35 on the NSE at 9:16 am.
One97 Communications has transferred its nodal account to Axis Bank through an escrow account, affirming continued operations for Paytm QR, Soundbox, and card machines, the company confirmed in a statement.
The RBI’s extension also prompted the issuance of FAQs addressing concerns such as remaining balance, UPI payments, and FASTag on vehicles, specifically tailored for Paytm Payments Bank account holders.
Despite these developments, Citi maintains a “sell” rating on Paytm’s stock with a target price of Rs 500 a share, citing gaps in RBI’s FAQs concerning bank partnerships.
According to Citi, the transition of Paytm Nodal Account to Axis Bank and the deadline extension do not affect business operations linked to non-Paytm Payment Bank accounts.
Jefferies India has suspended its rating on Paytm, shifting to “not rated” from “underperform,” citing anticipated revenue decline in FY25E and potential cash burn issues.
In the previous session, Paytm shares closed at Rs 341.30 on the National Stock Exchange (NSE), marking a 5% upper circuit and reflecting a 55% decline in the past month.
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