Paytm shares continue rally on profit expectations ahead of Q1 results

Time of India

22-07-2025

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Shares of Paytm parent One97 Communications has risen over 6% in the week leading up to its June quarter results. The fintech major reclaimed the Rs 1,000-mark last week, following business recovery and topline growth.The stock was trading 3% higher at Rs 1,049.75 as of 11:05 am, close to its 52-week high of Rs 1,063. Meanwhile, the Sensex saw a marginal rise of 0.07%. The counter has gained nearly 132% in the past 12 months, according to BSE data.The mean of target price for Paytm shares from 16 analysts polled by ET stands at Rs 966, implying a downside of 5%.Paytm is expected to post strong financials for the June quarter, swinging to profit compared to a loss in the year-ago period. The company had reported a net loss in the last quarter on account of an one-timePaytm's parent saw its consolidated net loss slightly narrow to Rs 540 crore in the three months ended March 2025, from a Rs 550 crore loss in the same quarter last year. The company had stated that its bottom line, without exceptional losses, is at a breakeven point. Operational revenue declined 16% year-on-year to Rs 1,912 crore in Q4FY25 from Rs 2,267 crore a year ago. The company is scheduled to post its financial results for the June quarter on July 22.Paytm has been recovering after being hit by regulatory actions last year. The company got approval from the National Payments Corporation of India (NPCI) last October to restart onboarding Unified Payments Interface (UPI) customers after an eight-month ban. The licence came after the Reserve Bank of India advised the UPI operator to review Paytm's request to become a third-party application provider (TPAP) and diversify app providers to reduce concentration risk.Since then, the digital payments platform has been working to add UPI customers through its partner banks: Yes Bank HDFC Bank and State Bank of India The company is also gradually improving its business metrics, led by healthy momentum in the merchant business, according to brokerage Motilal Oswal. Meanwhile, disbursement volumes and gross merchandise value (GMV) are also growing at a steady rate.Paytm has expressed strong confidence in its merchant loan distribution business, where it assists with both distribution and collection.The company has now begun providing a Default Loss Guarantee (DLG) for select portfolios with specific lenders. This move, according to Paytm, will help expand its merchant base and enhance its financial services revenue in the long term.