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  5. Paytm shares decline nearly 5%: Here’s what analysts said after December quarter earnings

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Paytm shares decline nearly 5%: Here’s what analysts said after December quarter earnings

Ahana Chatterjee - image.jpg
By Ahana Chatterjee

4 min read | Updated on January 30, 2026, 14:06 IST

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SUMMARY

Bernstein noted that net margin pressure in Q3 was largely seasonal, driven by elevated cashback spending

Stock list

PAYTM
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At 2 PM, Paytm shares were trading at ₹1,129.60 apiece on the National Stock Exchange, declining 3.3%. | Image: Shutterstock

At 2 PM, Paytm shares were trading at ₹1,129.60 apiece on the National Stock Exchange, declining 3.3%. | Image: Shutterstock

Paytm operator One97 Communications shares tumbled nearly 5% to an intraday low of ₹1,112.2 on Friday, January 30, after the fintech firm posted a net profit of ₹225 crore during the quarter under review in the December quarter of FY26 as compared to a loss of ₹208 crore in the December quarter of the 2024-25 fiscal year (Q3FY25).

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In the previous quarter, the company had logged a net profit of ₹21 crore, marking a 971.43% quarter-on-quarter (QoQ) jump.

Its revenue from operations surged 20.02% year-on-year (YoY) to ₹2,194 crore for Q3 of FY26, as against ₹1,828 crore in the same period of the previous fiscal year.

On a sequential basis, its revenue from operations soared 6.45% QoQ from ₹2,061 crore in the September quarter of the current fiscal year.

At an operational level, its EBITDA (earnings before interest, tax, depreciation and amortisation), also known as operating profit, turned positive and stood at ₹156 crore in the December FY26 quarter. Its EBITDA margin was 7% during the reporting period.

Paytm share price

At 2 PM, Paytm shares were trading at ₹1,129.60 apiece on the National Stock Exchange, declining 3.3%.

Over a month’s time, the stock has slipped over 13%, while it has gained 5% in the last six months. On a year-on-year basis, shares of Paytm have zoomed more than 45%.

Shares of the firm had hit a 52-week high of ₹1,381.8 on December 2, 2025, and a 52-week low of ₹651.50 on March 11, 2025.

The company has a total market capitalisation of ₹71,623.96 crore, according to data on the NSE.

Here’s what analysts said

In a note on Friday, analysts at Bernstein said Q3 FY26 marked a strong and reassuring performance, underscoring the company’s resilient operating momentum. Financial services revenue surged 34% year-on-year (YoY), even as the contribution from DLG loans moderated. The underlying transaction scale remained robust, with services revenue climbing over 20% quarter-on-quarter.

The analysts highlighted continued cost discipline, with indirect costs declining 8% YoY, while GMV expanded a healthy 23% YoY, aided by a higher pace of device installations. Monthly transacting users increased by around 6 million sequentially, reflecting sustained customer engagement.

Bernstein noted that net margin pressure in Q3 was largely seasonal, driven by elevated cashback spending. Margins are expected to normalise going forward, with payment processing margins trending above 4 basis points.

Further, CLSA analysts said Paytm’s GMV growth of 23% was broadly in line with their expectations. The net take rate for payments moderated to 8.4 basis points, easing from a high base of 9.1 bps in the previous quarter. On the cost front, employee operating expenses (excluding the labour code impact) rose 7% QoQ, which the analysts noted was a sharp increase compared with the trend over the past several quarters.
CLSA highlighted that Paytm earned ₹220 crore in 9MFY26 under the RBI’s PIDF scheme, which ended in December 2025. As a result, the brokerage cut its PBT estimates by 3–5%, reflecting the absence of PIDF income, partly offset by lower advertising spending.
Analysts at Jefferies said Paytm's profit for Q3 was a tad ahead of estimates even as it included ₹12 crore of one-time labour code cost. They added that greater clarity on management’s plans to offset the loss of PIDF incentives—estimated at around ₹0.9 million in Q3—will be a key monitorable going forward.
Morgan Stanley analysts said Paytm delivered a mixed performance, with moderation in revenue growth and lower sequential contribution margins, although EBITDA remained strong, supported by tight cost control.

Operating revenue growth slowed to 20% year-on-year, compared with 24% YoY in the previous quarter. Management, however, noted that overall revenue growth would have been closer to 25% YoY on an adjusted basis.

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About The Author

Ahana Chatterjee - image.jpg
Ahana Chatterjee is a business journalist with 7 years of experience across several leading news platforms. At Upstox, she covers stock markets and corporate news.

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