Paytm share price rallies over 3% to hit 52-week high on block deal buzz, hopes of MSCI inclusion

Paytm share price rallied over 3% to a fresh 52-week high after reports of huge block deal. Paytm shares gained as much as 3.84% to hit a 52-week high of ₹939.00 apiece on the BSE.

Around 2.3 crore Paytm shares or 3.6% stake of the company changed hands in a bunch of deals, according to reports.

Earlier, reports said that Antfin was set to sell another 3.6% shares, or 2.3 crore shares in the fintech giant via block deal on Friday.

The Jack Ma-founded Antfin (Netherlands) Holdings was poised to offload Paytm shares at ₹880.10 apiece. After the deal, Antfin’s stake in Paytm will be reduced to 9.9%.

Antfin had earlier this month sold a 10.3% stake to Resilient, an overseas entity which is 100% owned by Paytm founder Vijay Shekhar Sharma. With this, Sharma becomes the sole Significant Beneficial Owner (SBO) of Paytm whose current stake in the company is 19.42%.

Analysts believe reduction of Antfin’s shareholding to 9.9% and the change of Paytm’s SBO to Sharma, will remove the overhang of Chinese shareholding.

Read here: Vijay Shekhar Sharma-Antfin deal: Chinese shareholder reducing stake in Paytm a fundamentally positive, say analysts

Shares of One 97 Communications, the parent company of Paytm, has jumped more than 73% this year so far.

Meanwhile, higher free float and greater weightage may lead to inclusion of Paytm shares in the MSCI index.

As analyzed by Nuvama Alternative & Quantitative Research, FTSE Index provider should include additional floating Paytm shares within the next three to four days itself. 

“This inclusion is expected to generate a passive flow (minuscule) of approximately $7 million, involving 0.5 million shares and resulting in a volume impact over 0.10 days,” said Abhilash Pagaria, analyst at Nuvama Alternative & Quantitative Research in a note.

Meanwhile, if Paytm updates September shareholding before early October, there is a possibility that it could qualify for November MSCI Standard Index.

The potential influx would be $145 million, as per Nuvama which said that Paytm remained its high conviction inclusion pick.

At 9:25 am, Paytm share price was trading 1.20% higher at ₹915.05 apiece on the BSE.

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