Paytm shares fall 3% after Goldman Sachs downgrades rating

On February 22, Paytm shares experienced a decline of approximately 3 percent following Goldman Sachs’ decision to downgrade the stock to a ‘neutral’ rating. The renowned investment firm also revised the target price for Paytm shares to Rs 450, down from the earlier estimate of Rs 860 per share. This adjustment reflects concerns regarding the potential loss of market share in the payments sector.

Goldman Sachs cited the recent directive from the Reserve Bank of India (RBI) imposing stringent restrictions on Paytm Payments Bank (PPBL), which is expected to result in a slowdown in lending activity in the near term. Consequently, analysts at Goldman Sachs have revised down revenue and adjusted EBITDA estimates for the fiscal years 2024-2026 by up to 36 percent and 80 percent, respectively.

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The revised forecasts anticipate a 21 percent year-on-year decline in revenues for FY25, a significant adjustment from the previous projection of 16 percent growth.

As of 10:49 am, Paytm shares were trading at ₹391.35, reflecting the market’s reaction to Goldman Sachs’ updated assessment of the company’s prospects.