Motilal Oswal raises Paytm target price to Rs 1,000, sees earnings nearing inflection point
ADVERTISEMENT According to MOSL, Paytm's contribution margin is expected to improve significantly, reaching approximately 58% by FY28. This optimism is driven by expectations of a gradual recovery in payment business revenues, with an estimated overall revenue compound annual growth rate (CAGR) of 22% between FY25 and FY28.
The report also highlights Paytm's deepening ecosystem integration, which is likely to strengthen its merchant market share. Gross Merchandise Value (GMV) is projected to grow at a robust 23% CAGR over the same period.
On the lending front, MOSL noted that Paytm's FLDG (First Loss Default Guarantee) model will support disbursement growth. The brokerage also expects an uptick in personal loan disbursements in the second half of FY26, suggesting a potential revival in the company's lending momentum.The revised outlook reflects improved visibility on profitability and Paytm's ongoing efforts to scale its core business while adapting to regulatory changes in the digital payments and lending space.Paytm operator One97 Communications reported a consolidated net loss of Rs 540 crore in Q4FY25, marginally lower than the Rs 550 crore loss in the year-ago period.
ADVERTISEMENT Revenue from operations for the March quarter stood at Rs 1,912 crore, down 16% year-on-year from Rs 2,267 crore in Q4FY24.Sequentially, the net loss widened from Rs 208 crore in Q3FY25, though revenue improved nearly 5% from Rs 1,828 crore in the previous quarter.
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Paytm shares rose as much as 1% to Rs 933.9 during Tuesday's trading session. The stock has gained 16% in the past three months and is up 125% over the last 12 months. However, it has declined 6% on a year-to-date basis. The company's current market capitalisation stands at Rs 59,760 crore.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
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