November 29, 2021

The World Stock Markets Tips & Targets, News, Views & Updates

The World Stock Markets Tips & Targets, News, Views & Updates

BlackRock, Canada Pension bought more Paytm stock after weak market debut

Several of the biggest investors in Paytm’s record-breaking initial public offering added to their stakes in the Indian fintech giant after shares plunged by as much as 41%, according to people familiar with the matter.

Inc. and Canada Pension Plan Investment Board were among so-called in the IPO that bought more shares on Tuesday and Wednesday, the people said, asking not to be identified discussing private information.

The stock climbed for a third day on Thursday, rallying as much as 7% to 1,875 rupees in early Mumbai trading. That’s still a fair distance away from its issue price of 2,150 rupees. The size of this week’s purchases by couldn’t immediately be learned. Representatives for and CPPIB declined to comment.

ALSO READ: Dozen Indian IPOs now under extra investor scrutiny after Paytm debacle

Paytm’s early tumble ranked among the worst debuts by a major technology company since the dot-com bubble era of the late 1990s. Any sign that influential money managers like are doubling down on the company may help ease concern about the sustainability of an Indian stock-market boom that has lured $17 billion of foreign inflows over the past year and stoked a trading frenzy among local individual investors.

chart

While Paytm’s shareholders include big-name investors like Warren Buffett’s Berkshire Hathaway Inc. and Masayoshi Son’s SoftBank Group Corp., some analysts have questioned the company’s valuation and path to profitability. Macquarie Capital Securities (India) Ltd. has a price target of 1,200 rupees, about 32% lower than the stock’s closing level on Wednesday.

Chief Executive Officer Vijay Shekhar Sharma, who made no secret of his desire for his company to surpass the long-standing IPO record set by Coal India Ltd. in 2010, said last week that the stock’s early tumble was “no indicator of the value of our company.”

“We are in it for the long haul,” Sharma said in an interview. “We’ll put our heads down and execute.”

The $2.5 billion offering by Paytm, formally known as One 97 Communications Ltd., was arranged by banks including Morgan Stanley, Goldman Sachs Group Inc., Axis Capital, ICICI Securities, JPMorgan Chase & Co., Citigroup Inc. and HDFC Bank Ltd.

–With assistance from Silla Brush and Nupur Acharya.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Share This :