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Jefferies temporarily suspends coverage on Paytm due to uncertain valuation, pending RBI regulatory actions, potential merchant/user attrition, and the closure of Paytm Payments Bank's wallet business. The outcome of Enforcement Directorate investigations, government approval for payment aggregator license, and onboarding of Axis Bank are awaited.
The investment bank has moved the stock to “not rated”, weeks after lowering it to underperform after the Reserve Bank of India last month ordered Paytm Payments Bank to halt its key operations, citing non-compliance.
Jefferies said it has moved to 'not rated' from underperform and now see a 28% year-on-year decline in FY25E revenues that pushes Paytm into cash burns
Upon securing preliminary approval in 2022, Mswipe set its sights on piloting its internally developed payment gateway stack with its established merchant base. It was looking to become a full-stack payments player, diversifying from offering offline merchant acceptance devices.
The brokerage said it would stop the coverage of the stock until the news flow around Paytm and its associate, Paytm Payments Bank, “settles down”.