Paytm’s parent company, One97 communications collapsed by about 10% to Rs541 apiece on the BSE in morning trade. Following reports said that Japan’s SoftBank Group Corp has offered to sell a 4.5 percent stake in the company that was traded in a single block on the NSE.
This trade pulled down the shares of Paytm to their largest decline since July. Reports implied that Japan’s SoftBank will sell a third of its stake in One97 Communications Ltd, the proprietor of the Paytm payments app, via a $200 million single block deal.
SoftBank, which controls 12.9% of Paytm, intends to sell 29 million claims or 4.5% of the fintech corporation on Thursday, suggested the given reports on Wednesday. The stakes are being presented to institutional investors at ₹555-601. If finalized, the deal will bring Japan’s SoftBank at most nominal ₹1,628.9 crores or $200 million, the information added.
The deal follows the end of one-year compulsory lock-in for the pre-IPO lenders in Paytm. Stocks often drop after these lock-ups expire, as investor selling puts underneath pressure on the claims.
Paytm stakes made their stock market debut in November last year and the scrip has declined nearly 65% since its listing amid the global tech slowdown that started last year. Other new-age tech stocks, including Zomato, Nykaa, and PB Fintech – which went public last year, have also had tough months so far on the stock market and have already fallen below their respective issue prices.
Paytm’s CEO Vijay Shekhar Sharma in a note to investors earlier this week said that the organization is on the correct track to profitability and free money flows, after its current quarterly reports which revealed substantial operational leverage and a decline in EBITDA losses.
