Stock Market Today: The One 97 Communications (Paytm) share price has decline more than 40% since January end post the Reserve Bank of India's action on its payment Bank. The One 97 Communications (Paytm) is expected to report significant decline in revenues in its major segments during the quarter ending June'2024.
Yes Securities arrive at an overall sequential de-growth in revenue from operations of 32% by One 97 Communications (Paytm) during the Q1 as they expect payment services to Consumer, to Merchants and to financial services and others to decline sequentially.
Yes Securities expects 40% sequential de-growth in Payments services to consumers, a 35% sequential de-growth in Payments Services to Merchants and a 30% sequential de-growth in Financial Services and Others.
Payment Processing Charges (PPC) revenues as a percentage of Payments is expected to be at 55.5% compared to 46% in 4QFY24, mainly because it had received UPI incentive in Q4FY24.
Total Expenses (ex PPC) are expected to rise of 7% sequentially, an improvement over a de-growth of 12% in 4QFY24. Adjusted for the cost on ESOP and other expenses, Yes Securities arrives at Ebitda margin (of 60.4%, a sequential decline of 5,050 basis point
Motilal Oswal Financial Services also expects revenue from its operations to decrease 36% YoY to around ₹1490 Crore as contribution profit too is expected to decline 51% YoY to around ₹640 Crore during 1QFY25. Gross Merchandise Value is estimated by Motilal Oswal to decline 7% YoY in 1QFY25, amounting to ₹4.3 trillion. The contribution margin is also pegged at 43%. They expect adjusted operating loss to be at ₹490 Crore in 1QFY25. Motilal Oswal Financial Services currently has Neutral ratings on the stock.
However, One 97 Communications (Paytm), which is trading ₹434 remains among picks of StoxBox who have given a target price of ₹449 with a stop loss of ₹398. As per Stoxbox Paytm has a large, engaged customer base and is expecting Ebitda breakeven by FY25. The stock as per them has shown potential trend reversal patterns on the technical charts recently, making it a compelling buy at current levels.
A key monitorable as per Motilal Oswal Financial Services is any further impact of the RBI notification.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions
