One 97 Communications (PAYTM) share price has moved sideways recently even as the company’s performance continues improving. The stock was trading at ₹650, where it has been in the past few days. This price is ~50% above the lowest point in 2022.
Analysts are upbeat about Paytm
One 97 Communications, the giant payment company that owns Paytm, has been under pressure since it went public in 2021. The shares are about 66% from the highest point in 2021. As a result, the company has lost Softbank and Ant as investors. Ant, owned by Alibaba, had a ~25% stake in the company while Softbank had a ~13% stake.
The most recent statement from the company showed that it was doing well. The average monthly transacting users averaged 90 million in March while the number of merchants jumped to 6.8 million. In all, the number of users was up by 27% on a YoY basis. Total Gross Merchandise Volume increased by 40% YoY while the value of loans through its platform rose by 253%.
Analysts believe that the Paytm share price has more upside going forward. For one, the company has insisted that it has a strong path to profitability. As a result, it has decided to buy back over $103 million in stock.
The other potential catalyst for the stock is its growing market share in offline payments. In the most recent quarter, the company said that it had deployed over 6.8 million devices and deployed over $544 million in loans. In a note, analysts at Goldman Sachs wrote that:
“We see the improving profitability as a meaningful catalyst for the stock and expect Paytm to be net income profitable in FY25E. We have further raised our FY23E-25E adjusted EBITDA estimates up to 8% for Paytm.”
Goldman Sachs is not the only company bullish on Paytm stock price. In a statement, analysts at Motilal Oswal wrote that the shares could jump by 30% in the long term. They wrote:
“Digital payments industry is forecasted to double to USD16t by 2026, within which the mix of digital payments is likely to increase to 65%. Thus, digital payments are expected to surge ~3x to USD10t by 2026 from USD3t in 2021.”
Paytm share price forecast
Paytm chart by TradingView
The Paytm stock price has been in a slow bullish trend in the past few weeks. On the daily chart, the stock moved above the 25-day and 50-day exponential moving averages (EMA). It has also jumped above the ascending trendline shown in green. This trendline connects the lowest levels since November last year.
Therefore, if the stock jumps, the next key resistance point to watch will be at ₹841.95, the highest point on August 8. This price is about 30% above the current level. A move below the support at ₹600 will invalidate the bullish view.
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