Paytm's Over Valuation: Shares May Break 44%: Target Price Rs
MUMBAI: The listing of shares of Paytm-One2 Communications Ltd has made many investors cry today. The stock has plunged 9 per cent from its current issue price of Rs 2,150 today to a low of Rs 150 in the lower seller's circuit, while foreign broking giant Macquarie has raised the company's share price from Rs 4,150 to Rs 1,350. Accordingly, the target price of the stock has been set at Rs. Broking House believes that Paytm's business model lacks focus and direction and is a company seeking huge sums of money. Macquarie said it was a big challenge for the company to make a profit and that regulation as well as competition were factors of concern. The valuation of Paytm is estimated to be three times more expensive than the FY208 price and the long-term profitability is uncertain. The price-to-sales growth ratio has also been 0.2-0.5 times higher for most fintech companies-entrepreneurs and is in the upper band in this band. So Macquarie doesn't want to pay a premium t...