Paytm shares crash to new low of Rs 476
Paytm’s parent company, One97 Communication, today dropped to a fresh low of Rs 476 on BSE as the sell-off continues after its pre-IPO (initial public offering) shares became free to trade.
After a weak open, the stock plunged to record lows of Rs 476 in morning trading. It attempted a recovery from lows, but sentiment remained weak. The stock is trading at Rs 480, still 10 less than its previous close.
After a weak open, the stock plunged to all-time lows in morning trades. It attempted a recovery from lows, but sentiment remained weak.
Paytm has disappointed investors since its IPO last year. Last week, early investor Softbank sold a 4.5% stake at Rs 555 – Rs 601, which was discounted. The biggest investor selling his stake after such falls weakened sentiment on this counter, said Rahul Sharma, head of research, Equity 99.
Analysts have noted that an oversupply of stocks in the market is weighing heavily on Paytm. A large supply of shares is coming from investors from pre-IPO placements as well as non-sponsored investors, the analysts added.
According to SEBI rules, pre-IPO investors must hold the shares after the IPO for six months to a year from the IPO. This blocking period expired on November 15.
“Markets are not respecting non-profit company valuations which are not warranted at this time,” said Prashanth Tapse – research analyst and senior vice president, research – Mehta Equities.
Paytm was listed on November 18 last year. Compared to IPO prices of Rs 2,150 per share, investors have suffered huge losses as the share is trading at Rs 483.
Other New Age stocks, listed in November-December last year, are suffering the same fate in the market today.
Fashion retailer Nykaa is trading at Rs 177.30, down 3.41%. Policybazaar is trading down more than 1% at Rs 407.25.
The lock-up period for both shares has expired.
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