The decline in Paytm’s stock is not stopping, investors lose Rs 50,000 crore

Paytm Free Fall Continues: Since the listing of Paytm’s IPO, the trend of decline in the stock is not stopping. Even on the second trading day of listing in the stock market, Paytm has disappointed its investors very much. When the market opened in the morning, Paytm fell below its previous closing rate of Rs 1560.80 and opened at Rs 1509.

Paytm’s stock slips 18.50%

But with the profit-booking in the market, the share of Paytm also fell flat. Seeing this, it fell by more than 18.50 percent to Rs 1271. However, some buying returned in the stock from the lower level. And today when the market closed, Paytm closed at Rs 1359 per share. Paytm’s market capitalization has also gone down from Rs 1 lakh crore to Rs 88,139 crore.

The loss of investors is increasing

Like the disappointment of Paytm’s investors, such a disappointment did not happen to investors of any IPO during the listing in the recent past. Since the listing, Paytm has lost Rs 50,000 crore to investors. Before listing in the stock market, the market value of Paytm according to the IPO price was Rs 1.39 lakh crore and today its market cap has come down to Rs 88,139 crore.

The fall in Paytm was such that the stock was on the verge of putting lower circuit on the second day of its listing as well. The stock of Paytm has closed down 37 percent from its issue price of Rs 2150, down by Rs 791.

Brokerage houses cut target

The question arises that where will the trend of decline in Paytm’s stock stop. Because market experts are advising to stay away from this stock, as well as some are expressing the possibility of further decline. Foreign brokerage house Macquarie has reduced the target of Paytm to Rs 1200. That is, about 44 percent below the issue price. According to Macquarie, Paytm’s business model lacks direction. According to him, making profit is a big challenge for Paytm.

Investors taking the brunt of the greed of the promoters

After the listing of Paytm, stock market experts are questioning its business model as well as questioning its market valuation. Its investors are paying the price for the greed of the promoters of Paytm.

Lessons for investors from Paytm’s IPO

Paytm’s IPO teaches a lesson to investors as well as promoters and merchant bankers of companies, who decide the price band of shares in their IPO at a higher price. An investor will invest in an IPO only when he expects returns. After this fate of Paytm’s IPO, many experts believe that the IPO market may get a setback. And many other companies which were preparing to bring their IPO, their plans may be dashed.

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