Paytm Stock Price :A very big news has come about the online payment platform Paytm. Paytm is selling its entertainment ticket business to Zomato. This deal has been done between the two companies for Rs 2048 crore. After this deal, Paytm shares are seeing a decline today. At the same time, after this move of the company, brokerage houses have also become alert about the stock. However, they say that after this deal, Paytm will get a chance to focus on its core payment and financial services distribution business.
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Paytm founder Vijay Shekhar Sharma said in a letter to shareholders that we will focus on creating a profitable model while focusing on our core business. He said that we have prepared a long term plan for Paytm. We have faced many challenges in the past. We are ready to move ahead from these challenges.
Motilal Oswal : Neutral
Brokerage house Motilal Oswal says Paytm has agreed to sell its entertainment ticketing business to Zomato for Rs 20.48 billion in cash, which will allow Paytm to focus on its core payments and financial services distribution business.
The combined entertainment ticketing business is estimated to generate revenue of Rs 2.97 billion and adjusted EBITDA of Rs 290 million in FY24. Paytm previously built its movie ticketing business by acquiring Insider and TicketNew for $2.68 billion between 2017 and 2018.
During the transition period (up to 12 months), movie and event tickets will be available on the Paytm app as well as on the Ticketnew and Insider platforms. This transaction is expected to further strengthen Paytm’s balance sheet and the company will be able to focus on its core payment and financial business. The brokerage house says that by 2027, it is estimated that the company’s EBITDA will become positive. The brokerage has given a neutral rating to the stock and has a target price of Rs 550.
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Citi : Sell
Brokerage house Citi has given a Sell rating on Paytm shares and has a target price of Rs 440. The brokerage says that the sale of its entertainment ticketing business (movies + events) to Zomato is positive as the deal value was higher than the implied value. The next trigger will be government approval of FDI for payment aggregators, which will push payment aggregator license applications back to RB.
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The stock has weakened by 73% from its IPO price
Paytm’s stock has fallen by about 73 percent from its IPO price. During the IPO in November 2021, its upper price band was Rs 2150. Currently, the stock has come down to Rs 580. While brokerages are predicting a further decline in it.
(Disclaimer: Investing or selling stocks is advised by experts and brokerage houses. These are not the personal views of Financial Express. There are risks in the market, so take expert advice before investing.)
