For the first time since Paytm went public, domestic mutual funds have reduced their shareholding, even as several brokerages have upgraded the stock and raised price targets.
Mutual Funds Reduce Their Paytm Holding
At the end of December, mutual funds owned about 14.34% of Paytm, down from 16.25% three months earlier. The biggest holders – Motilal Oswal MF, Nippon India MF and Mirae Asset MF – all trimmed their stakes. Bandhan MF no longer appears in the list, suggesting its holding fell below 1% or the fund exited completely.
Retail Investors Keep Selling
Individual shareholders (those holding up to Rs 2 lakh) have also been selling, with their share of Paytm dropping for seven straight quarters. Their ownership is now at the lowest level seen since September 2023.
Analyst Upgrades and Higher Price Targets
Goldman Sachs moved Paytm to a "Buy" rating and lifted its target price to Rs 1,570, more than double its earlier estimate. The firm sees improving regulatory conditions and growing market share as reasons for a potential 20% upside.
Jefferies also raised its target to Rs 1,600, citing strong growth prospects in wealth, lending and international segments. Other brokerages such as YES Securities, Emkay and Ventura have given buy or add ratings with targets ranging from Rs 1,400 to Rs 1,600, pointing to better profitability and expanding merchant networks.
What Could Be Next for Paytm?
- Revenue Growth: Analysts expect Paytm’s revenue to rise more than 20% over the medium term.
- Merchant Expansion: The company’s offline merchant base could grow from 13 million devices to over 22 million by FY28.
- Profitability: Improved payment margins and cost control are projected to boost earnings before interest, taxes, depreciation and amortisation (EBITDA).
- Risks: Deterioration in the quality of lending assets remains a key concern for investors.
Overall, the reduction in mutual‑fund and retail holdings may reflect short‑term profit‑taking, while the upgraded analyst outlook suggests a more optimistic medium‑term view for the stock.
Remember, this is perspective, not a prediction. Do your own research before making any investment decisions.