Services Sector Stock Soars 10% Intraday, Buy With Target Price Rs 1000: Motilal Oswal

Share price of Paytm jumped nearly 10% in morning trade on Monday soon after its MD & CEO, Vijay Shekhar Sharma inked an agreement to acquire 10.3% of the company's shares from Antfin (Netherlands) Holdings B.V. for $628 million. Paytm share current market price is Rs 848.80 apiece on BSE with intraday gain of 6.71% at 10:59 am. Meanwhile, brokerage firm Motilal Oswal has recommended buy call for Paytm Share with target price of Rs 1000 apiece. Check details below:

Vijay Shekhar Sharma To Buy 10.30% Stake In Paytm From AntFin: As per the BSE filing of Paytm dated Aug 7, "Pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended, we have been informed by Vijay Shekhar Sharma (Founder, Managing Director and CEO of the Company), and Antfin (Netherlands) Holding B.V. ("Antfin"), that they have entered into an agreement on August 07, 2023 whereby Antfin will transfer 65,335,101 shares of the Company to an entity 100% owned by Mr. Sharma - Resilient Asset Management B.V. ("Transaction"). This implies a transfer of 10.30% of the share capital of the Company (Company / Paytm)."

Paytm Stock Performance & Return: Paytm stock opened at Rs 860.55 apiece, touched its day's high at Rs 887.55 per share and day's low of Rs 848.00 apiece till 9.35 am on Monday. Paytm stock witnessed a spurt in volume by more than 1.07 times today. Earlier on Aug 4, the shares saw a spurt of 2.34 times. Paytm's 52-week high price is Rs 915.00 apiece and 52-week low price is Rs 439.60 apiece. The company's market capitalisation at 9:37 am is Rs 54,017.39 crore. Paytm stock rallied 6.33% in last 1-week only when Sensex declined 1.06% and recorded yet another rally of 6% in last 14 days when BSE Sensex fell 0.85%. In last 1-year, Paytm shares offered its shareholders return of 8% and 60% return year to date (YTD).

Paytm Stock Valuation: According to Motilal Oswal brokerage report dated July 23, 2023, "Paytm reported a largely in-line 1QFY24 with sustained momentum in GMV and robust growth in disbursements. This, coupled with strong traction in subscription devices, led to healthy growth in total revenue. Gradual improvements in operating leverage boosted contribution margin to 56%. We value Paytm based on 17x FY28E EV/EBITDA and discount the same to FY25E taking a discount rate of ~15%. We thus value the stock at INR1,000, which implies 4.7x FY25E P/Sales."

ICICI Securities Recommends Buy: According to the analyst, in its July 24, 2023 report, "Positive levers can come from expansion of credit partners (likely to add 3-4 partners in FY24) as well as launch of co-branded RuPay credit card (May'23). Maintain BUY with a target price of INR 1,055 (unchanged) based on the DCF methodology."

Paytm About: Paytm started the Digital Revolution in India. Today, more than 20 Million merchants & businesses are powered by Paytm to Accept Payments digitally. Over 300 million Indians use Paytm to Pay at their stores. Paytm App is used to pay bills, do recharges, send money to friends & family, Book movies & travel tickets, according to its official website.

Disclaimer:The stock has been picked from the brokerage report of ICICI Securities and Motilal Oswal. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.