On Wednesday, August 13, shares of One97 Communications Ltd, the parent company of online payments aggregator Paytm, opened at a 52-week high after the Reserve Bank of India (RBI) granted its unit Paytm Payments Services Ltd., in-principle authorisation, to operate as an Online Payment Aggregator.
System Audit
The firm has been authorised to undertake a system audit, including one for cybersecurity, according to the RBI letter, which mentioned that merchant onboarding restrictions placed on PPSL in November 2022 have been withdrawn.
Audit Report To RBI
According to the regulator's letter, the audit report should be submitted to the RBI within six months, and if it is not submitted, the in-principle authorisation will lapse automatically, and the grant of a final authorisation will not be considered thereafter.
New Online Merchants
When the ban was imposed earlier, the Paytm management had stated that it would have no material impact on the business since it only applies to the onboarding of new online merchants.
Paytm Sees Exit Of Chinese Overhang
Recently, Paytm saw the exit of the Chinese overhang when Antfin sold its remaining stake in the company via block deals. Antfin also sold its stake in Paytm at a loss similar to Warren Buffett's Berkshire Hathaway.
Dolat Capital
According to CNBC, "Out of the 19 analysts that have coverage on Paytm, 10 of them have a 'buy' rating, five say 'hold', while four have a 'sell' rating. The highest price target on the street for Paytm is by Dolat Capital, which sees the stock at Rs 1,400.
Brokerage Firm Citi
With a price target of Rs 1,215, brokerage firm Citi has a "buy" rating on Paytm. It stated that the license win after nearly three years is a positive for sentiments. It lifts a major regulatory restriction on its business.On Wednesday, Shares of Paytm opened 4.3% higher at Rs 1,167.9. The stock has risen 15% in the last month, and nearly 50% in the last six months.
