At record low! Paytm share price at 10% lower circuit after a 36% fall in last 2 sessions

One 97 Communications (Paytm) share price extended losses for the third straight session, hitting its 10 percent lower circuit on Monday, February 5 at 438.35, also its record low.

Pranati Deva
Published5 Feb 2024, 09:16 AM IST
Paytm
Paytm

One 97 Communications (Paytm) share price extended losses for the third straight session, hitting its 10 percent lower circuit on Monday, February 5 at 438.35, also its record low on BSE.  The stock has already crashed 36 percent in the previous 2 sessions. 

This decline came after the Reserve Bank of India (RBI) barred Paytm Payments Bank (PPBL) from conducting certain operations following a system audit report and subsequent compliance validation report of external auditors.

With today's fall, the stock is now 56 percent away from its 52-week high and almost 80 percent below its IPO price of 2,150. Meanwhile, the stock has shed over 42 percent just in the 3 sessions of February after an almost 20 percent rise in January.  In the last one year, the stock has declined over 7 percent.

The central bank issued a directive on January 31, instructing PPBL to cease new credit and deposit operations, as well as other banking activities such as top-ups and fund transfers, after February 29 of the same year.

The action was reportedly taken due to Paytm Payments Bank's failure to comply with regulations despite repeated warnings. The concerns raised include falsified compliances, irregularities in Know Your Customer (KYC) norms, and related party transactions. The RBI seems to have taken a strong stance against these issues by halting certain banking operations of Paytm Payments Bank.

Meanwhile, the stock was also in focus amid media reports of an investigation by the Enforcement Directorate on One97 Communications Ltd, associates or its founder and CEO Vijay Shekhar Sharma for anti-money laundering activities.

However, in a press release, the firm categorically denied these allegations.

"Neither the Company nor its founder and CEO are being investigated by the Enforcement Directorate regarding inter alia money laundering. In the past, certain merchants/users on our platforms have been subject to inquiries and on those occasions, we have always cooperated with the authorities. During any such investigations by the authorities on any set of merchants/users in the past, we have cooperated with them on these investigations," it said in an exchange filing.

We would like to set the record straight and deny any involvement in anti-money laundering activities. We have and continue to abide by Indian laws and take regulatory orders with utmost seriousness, added the firm.

It further stated that The recent direction from RBI is a part of the ongoing supervisory engagement and compliance process. For this action, we refer our stakeholders to the official press release of RBI dated January 31, 2024, and not rely on unofficial sources.

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First Published:5 Feb 2024, 09:16 AM IST
HomeMarketsStock MarketsAt record low! Paytm share price at 10% lower circuit after a 36% fall in last 2 sessions

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