Paytm stock surges 8.5% to cross ₹400 after 8 weeks
The stock price of One 97 Communications, the parent company of Paytm, has seen a significant increase of 8.6%, reaching ₹414. This surge marks a 33.54% recovery from its all-time low of ₹310, which was recorded in May. The company's shares hit the 10% upper circuit limit during Friday's trading session. This comes after the stock exchanges raised Paytm's upper circuit limit to 10%, after a prior reduction to 5% due to the stock's high volatility following RBI's crackdown.
Paytm's recovery and stabilization in UPI business
Paytm has reported early signs of recovery and strong stabilization in its Unified Payments Interface (UPI) business. In May, the total value of UPI transactions processed on the Paytm platform increased to ₹1.24 trillion. This growth was driven by several new initiatives such as Credit Card on UPI and UPI Lite. Total transactions on the platform stabilized at 1.14 billion in May, reinforcing Paytm's position as the third-largest player in terms of market share.
UPI transactions hit record high in May
In May 2024, UPI transactions hit a record high of nearly 14 billion, marking a significant 49% year-on-year increase. The total value of these transactions amounted to ₹20.45 trillion, the highest since UPI's launch in 2016. This surge underscores the growing preference for digital payments among Indian consumers and businesses. Paytm has been proactive in promoting UPI and has partnered with various banks and financial institutions to enhance its UPI service.
RBI's restrictions impact Paytm's stock performance
In January, the RBI imposed restrictions on Paytm Payments Bank Limited (PPBL), prohibiting it from accepting deposits, credit transactions, or top-ups in any customer accounts, wallets, and FASTags. This led to a significant decline in the company's shares, with a 47% drop in February, followed by decreases of 7.51% in April and an additional 3.13% fall in May. For the fourth quarter of the financial year 2023-24, the company's loss widened to ₹550 crore.