The country’s largest digital payments provider, Paytm, lost more than a quarter of the value on its maiden day of trade on Thursday. As the markets closed at around 3:30pm, Shares of One97 Communications Ltd, PayTM’s parent company, tumbled 27.25 per cent, marking one of the worst-ever debuts by a major technology company.
Speaking on the crash, CEO Vijay Shekhar Sharma said he was unperturbed by the slide and did not regret listing in India, according to a report by Reuters. “One day does not decide what our future is,” the CEO said.
“It is a new business model and it takes a lot for somebody to understand it straightforward… there is a lot for us to bring to the markets and the market participants,” it also quoted Sharma as saying.
According to Shifara Samsudeen, a LightStream Research analyst, “Paytm’s financials are not very impressive and the growth prospects seem limited… obviously, the company lacks a clear path to profits,” Reuters reported.
Here are key things to know about the crash:
>Paytm’s ₹18,300 crore IPO was oversubscribed 1.89 times on the last day of India’s biggest share sale last week.
>This was greater than miner Coal India’s ₹15,000 crore offer a decade back.
> The shares tumbled over 27 per cent during the day from the issue price of ₹2,150. The stock was listed at ₹1,955, slipping 9 per cent from the issue price on the BSE. It then tumbled 27.25 per cent to ₹1,564 during the day.
> On the NSE, it debuted at ₹1,950, registering a decline of 9.30 per cent against the issue price. During the day, the stock plunged 27.34 per cent to ₹1,562.
> After today’s crash, the company’s market valuation falls to ₹1,01,484.00 crore on the BSE.
> Paytm, backed by China’s Ant Group and Japan’s SoftBank, grew rapidly after Uber listed it as a quick payment option in India.
>The company has now expanded into a plethora of services – insurance and gold sales, movie and flight ticketing, bank deposits and remittances.
(With agency inputs)