Citi sees Paytm shares rising 82% as growth momentum sustains in Feb
Paytm's operation metrics of February show the internet payments company is sustaining its growth trajectory, Citi said as it sees a potential upside of 82% on the stock.The brokerage has a "buy" rating on Paytm, with a target price of Rs 1,061. On Tuesday, the shares closed 0.47% lower at Rs 578 apiece on NSE. The stock has gained about 8.63% so far on a year-to-date basis.After intense selling pressure last year, Paytm has seen positive commentary from analysts in the recent past as the focus shifted to profitability. The company said it has turned EBITDA-positive in the December quarter even as reported losses narrowed significantly.Continuing the momentum in January and February, the company saw sustained growth in payments and loan distribution business. The loan distributions through its platform for the quarter to date (January and February) rose 286% year-on-year to Rs 8,086 crore ($979 million)."Its payments consumer and merchant base offers a large addressable market, thereby providing a long runway for growth. We continue to work with our partners to remain focused on the quality of the book," the company said.In the offline payments, about 6.4 million merchants currently pay subscription for payment devices, an increase of 0.3 million in the month of February."Paytm’s February operating metrics indicate sustained momentum in loan disbursals (6% month-on-month by value) and device deployment (0.3 million). Payment GMVs rose 39% year-on-year (MTUs: 85 million) and Paytm’s market shares in total UPI payments and digital merchant payments remained largely steady at 11% and 24%, respectively," Citi said in a report.In overall UPI, including peer-to-peer (P2P) payments, Paytm’s market share stood at 11% in February, which is up 60 basis points year-on-year, whereas Paytm’s market share in overall digital payments to merchants (including other instruments like credit cards ) stood at 24%. The top 3 players’ market shares are steady at 95%.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
Paytm's operation metrics of February show the internet payments company is sustaining its growth trajectory, Citi said as it sees a potential upside of 82% on the stock.The brokerage has a "buy" rating on Paytm, with a target price of Rs 1,061. On Tuesday, the shares closed 0.47% lower at Rs 578 apiece on NSE. The stock has gained about 8.63% so far on a year-to-date basis.After intense selling pressure last year, Paytm has seen positive commentary from analysts in the recent past as the focus shifted to profitability. The company said it has turned EBITDA-positive in the December quarter even as reported losses narrowed significantly.Continuing the momentum in January and February, the company saw sustained growth in payments and loan distribution business. The loan distributions through its platform for the quarter to date (January and February) rose 286% year-on-year to Rs 8,086 crore ($979 million)."Its payments consumer and merchant base offers a large addressable market, thereby providing a long runway for growth. We continue to work with our partners to remain focused on the quality of the book," the company said.In the offline payments, about 6.4 million merchants currently pay subscription for payment devices, an increase of 0.3 million in the month of February."Paytm’s February operating metrics indicate sustained momentum in loan disbursals (6% month-on-month by value) and device deployment (0.3 million). Payment GMVs rose 39% year-on-year (MTUs: 85 million) and Paytm’s market shares in total UPI payments and digital merchant payments remained largely steady at 11% and 24%, respectively," Citi said in a report.In overall UPI, including peer-to-peer (P2P) payments, Paytm’s market share stood at 11% in February, which is up 60 basis points year-on-year, whereas Paytm’s market share in overall digital payments to merchants (including other instruments like credit cards ) stood at 24%. The top 3 players’ market shares are steady at 95%.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
