Paytm shares extend losses, hit lower circuit for second straight day
Upstox
2 min read • Updated: February 29, 2024, 2:24 PM
Summary
Paytm shares have tanked nearly 50% since RBI's restriction announcement on January 31. The company hit a lower circuit on multiple occasions, leading to India's market regulator Securities and Exchange Board of India (SEBI) revising the circuit limit from 20% to 10% and finally to 5%.
Shares of One97 Communication Ltd, the parent entity of online payments platform Paytm, hit the lower circuit for the second consecutive day on Thursday.
At 10:42 AM, stocks of the fintech company hovered around ₹386.5 per piece on NSE, continuing their downward trajectory amid the troubles that ensued the Reserve Bank of India's crackdown on the Paytm Payments Bank Limited (PPBL) for alleged irregularities and noncompliance.
The central bank had barred the Paytm Payments Bank from accepting any deposits or top-ups in customer accounts, wallets, FAST Tags and other instruments after February 29. The deadline was later pushed to March 15.
Paytm shares have tanked nearly 50% since RBI's restriction announcement on January 31. The company hit a lower circuit on multiple occasions, leading to India's market regulator Securities and Exchange Board of India (SEBI) revising the circuit limit from 20% to 10% and finally to 5%.
RBI's crackdown on Paytm Payments Bank has led to Vijay Shekhar Sharma resigning from the post of Chairman of the bank and reconstitution of its board. Sharma, who served as the part-time non-executive Chairman of Paytm Payments Bank Limited also resigned from the board.
Central Bank of India Chairman Srinivasan Sridhar, former Executive Director of Bank of Baroda Ashok Kumar Garg, retired IAS officers Debendranath Sarangi, and Rajni Sekhri Sibal have joined the Paytm Payments Bank board as Independent Directors. One97 Communication Ltd holds a 49% stake in the bank while the majority 51% is held by Vijay Shekhar Sharma.
Earlier this month, One97 Communications transferred its nodal account to Axis Bank from Paytm Payments Bank to allow continuity of Paytm QR, Soundbox, and card machines after March 15.
The nodal account is where all its customers and merchant transactions are settled. The company is also working to shift the virtual payment address linked to PPBL, used by merchants for accepting transactions, to other banks to ensure no disruption in transactions after the RBI deadline.
Shares of Paytm were trading ₹390.8 apiece, down 3.79%, on NSE at 11:45 am.