Paytm stock jumps 122% in one year; still far from IPO price — Can the rally continue?
Despite the sharp rebound, the stock still trades 53% below its IPO issue price of Rs 2,150, prompting the big question, can Paytm reclaim its IPO-era peak.
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Currently hovering around Rs 1,018, Paytm is showing signs of a technical breakout. Analysts point to a consistent pattern of higher highs and higher lows (HH-HL), which typically suggests a sustained uptrend.
Drumil Vithlani, Technical Research Analyst at Bonanza Portfolio, noted the stock is nearing a critical resistance zone between Rs 1,020 and Rs 1,030 — a level where it faced heavy selling in December 2024.
'The stock has been consistently forming a higher highs–higher lows (HH–HL) structure, which indicates a sustained uptrend,' he added.
Vithlani advises existing holders to keep a stop-loss at Rs 980 and continue holding if the breakout is confirmed with strong volumes.
Hardik Matalia, Derivative Analyst at Choice Broking, sees bullish patterns forming on longer-term charts. 'There is a Cup and Handle pattern on the weekly chart and an Inverted Head and Shoulders on the monthly — both are bullish continuation setups that suggest potential for a move toward Rs 1,700,' he told ET.
'Paytm is comfortably trading above its 20-, 50-, 100-, and 200-day EMAs, and the RSI at 65.86 is trending upwards,' he added.
With June quarter results due today (July 22), analysts believe earnings could be a key trigger. Brokerages expect Paytm to post its first-ever quarterly profit, with a projected PAT of over Rs 18.9 crore a significant turnaround from last year's loss.
Revenue is expected to rise 27% YoY, led by growth in payments and financial services.
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While brokerages like YES Securities and JM Financial see improvement in loan disbursals and expense control, they caution that margins may be pressured by rising payment costs and the lack of UPI incentives.
A domestic fund manager summed up the outlook: 'Reclaiming the IPO price of Rs 2,150 will require sustained earnings delivery, clarity on regulatory concerns, and expansion in lending partnerships,' a fund manager at a domestic mutual fund told the outlet.
For now, the momentum is with Paytm. Whether it can turn early profitability into long-term growth, and win back long-term investors remains to be seen.
(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)
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