Home/ Companies / News/  Paytm appoints new statutory auditor, SRB to replace PwC

Fintech giant, Paytm has appointed S.R. Batliboi & Associates LLP (SRB, commonly known as EY) as its new statutory auditors for a tenure of 5 years, starting from the 23rd annual general meeting (AGM) to the conclusion of the 28th AGM. SRB will be replacing PwC as the latter's term will expire this year.

In its regulatory filing, Paytm said, "the Audit Committee, the Board of Directors of the Company... has considered and approved the appointment of S.R. Batliboi & Associates LLP, as Statutory Auditors of the Company for a term of 5 (five) consecutive years."

It added, SRB will be in place of existing auditors Price Waterhouse Chartered Accountants LLP whose term shall expire at the conclusion of the forthcoming 23rd AGM which will be held in the calendar year 2023.

The appointment of SRB is now subject to the approvals of the shareholders of Paytm.

SRB is a limited liability partnership firm of Chartered Accountants registered with the Institute of Chartered Accountants of India. The audit firm is part of S.R. Batliboi & Affiliates' network of audit firms. It is primarily engaged in providing audit and assurance services to its clients.

Last week, on Friday, Paytm's stock closed at 637 apiece up by 1.16% on BSE. The company's market cap is over 40,372 crore.

As per Paytm's policies and guidelines, the statutory auditors carry out reviews of the company’s internal control systems to obtain reasonable assurance to state whether an adequate internal financial controls system was maintained and whether such an internal financial controls system operated effectively in the company in all material respects with respect to financial reporting.

Recently, global major brokerages have shown optimism about Paytm as NPCI's wallet interoperability norms went live in April.

Morgan Stanley sees additional revenues for Paytm Payments Bank (49% owned by OCL) when PAYTM's full KYC wallet customers transact using their wallets on merchants acquired by other service providers.

Stanley also believes that One 97 Communications should also benefit as the interchange paid to Paytm Payments Bank would be lower, in line with the lower standardized interchange. However, this would imply lower revenues for Paytm Payments Bank.

On valuation, Stanley's note said, "we apply adj.F26e EV/sales multiples of 3.5x base,2.3x bear, and 3.6x bull & derive F25e EV, which we discount to Dec-24 at a 13.9% WACC. We then add net cash to arrive at PT. Relative valuation based on US payment firms." Stanley has given 'equal weight' to Paytm stock with a target price of 695."

Meanwhile, Citi has given a buy recommendation on Paytm for a target price of 1,061 per share.


Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.

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Updated: 02 Apr 2023, 01:10 PM IST
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