Paytm shares: Alibaba sells stake during buyback period. Who bought?
1 min read 16 Feb 2023, 11:00 AM ISTPaytm on Tuesday said it has completed share buyback worth ₹850 crore
PremiumOne97 Commuications (Paytm) has completed buyback of shares worth ₹850 crore at an average price of ₹545.9 per share. The board had approved the buyback proposal crore on December 13, representing 6.67% of the total paid-up share capital between December 21, 2022 to February 13. The company bought back shares in the price range of ₹702 to ₹480 apiece.
"The company bought back an aggregate of 1,55,66,746 equity shares utilising a total amount of ₹849,83,39,982, which represents 99.98 per cent of the maximum buy-back size. The price at which equity shares were bough back was dependent on the price quoted on the stock exchanges," Paytm had informed in an exchange filing earlier this week.
A share buyback, which is also known as share repurchase, is a corporate action to buy back its own outstanding shares from its existing shareholders usually at a premium to the prevailing market price. It can be an alternative tax-efficient way to return money to shareholders. Share buybacks reduce the number of shares in circulation, which can increase the share value and the earnings per share (EPS).
During the buyback period, Chinese e-commerce major Alibaba sold its entire direct stake in the company in two tranches. However, the company's group firm Ant Financial continues to hold around 25% stake in Paytm and remains the biggest shareholder of the digital financial services firm.
As per the NSE bulk deals data, Alibaba sold 192,00,000 shares at ₹536.95 on January 12 and 214,31,822 shares on 10 February at ₹642.74 during the buyback period. Meanwhile, Ghisallo Master Fund LP bought 49,80,000 shares at ₹534.8 per share on January 12 and Morgan Stanley Asia (Singapore) bought 54,95,000 shares on the same date. Morgan Stanley Asia also purchased 54,23,087 shares on Feb 10 while selling 5,23,878 shares on the same day, as per the exchange data.
The fintech company posted its first-ever quarterly operating profit as a listed firm and the company's losses also narrowed during the third quarter of the current fiscal (Q3 FY23). Paytm's net loss in the quarter through December narrowed to ₹392 crore as compared to ₹779 crore a year earlier whereas its revenue from operations rose 42% to ₹2,062 crore.
