A leading brokerage, Jefferies, has taken the decision to move Paytm-operator One97 Communications Ltd to 'not rated' due to the recent regulatory actions by the Reserve Bank of India. This shift is expected to cause a significant decline in the company's revenue and may result in cash burns in the future. The company's focus will now be on retaining customers and merchants through the use of its cash reserves. Paytm's nodal account has also been shifted to Axis Bank Ltd which is expected to have a positive impact on the business.
In a major blow to the embattled fintech giant Paytm, a global broking firm has downgraded its stock rating to "underperform" and slashed its price target by more than half. This downgrade comes in the wake of the Reserve Bank of India's regulatory action against Paytm's associated banking arm and highlights the company's struggle with customer exodus and its impact on monetization and business model. Paytm's stock has been under pressure for the past few weeks, and this fresh downgrade is expected to further worsen its financial standing.