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Business News/ Mutual Funds / Paytm stock crash: These mutual funds schemes likely to face music with NAVs under pressure
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Paytm stock crash: These mutual funds schemes likely to face music with NAVs under pressure

There are a number of schemes which have invested up to 4-5 percent of their portfolio in Paytm stock. These schemes will soon start reflecting impact of Paytm stock in their net asset value.

The sudden crash of Paytm stock has caught investors unaware . Pic: Kuni Takahashi/BloombergPremium
The sudden crash of Paytm stock has caught investors unaware . Pic: Kuni Takahashi/Bloomberg

As Paytm shares tanked 20 percent to hit lower circuit in the aftermath of Reserve Bank of India (RBI) barring Paytm Payments Bank from accepting deposits, there are concerns galore among retail investors and mutual fund houses alike.

There are a number of schemes which have invested up to 4-5 percent of their portfolio in Paytm stock. These schemes will soon start reflecting the impact of Paytm stock in their net asset value.

“Depending on their percent-age to NAV, they will see an NAV impact. These are holdings as of 31st Dec and may have changed as of date which will be disclosed by the MFs in the next few days," shared Manoj Nagpal in a post on X.

Active vs passive schemes

The allocation to Paytm is higher among active mutual funds vis-a-vis passive schemes. For instance, UTI Innovation Fund has 4.8 percent in the battered stock, Quant Teck Fund has 3.26 percent allocation, Quant Mid Cap Fund with 3.17 percent allocation, Nippon Innovation Fund with 2.96 percent, Mirae Focused Fund with 2.90 percent, Helios Flexi Cap Fund with 1.95 percent and Motilal Focused with 1.57 percent.

The top passive schemes which have highest allocation to Paytm stock include Tata Nifty India Digital ETF (2.89 per cent), Kotak Nifty Alpha 50 ETF (2 per cent), Bandhan Nifty Alpha 50 Index (with 1.94 per cent) and Motilal S&P BSE financial (with 1.76 percent).

These figures were compiled on the basis of their allocation as on Dec 31, 2023. The present allocation may have changed slightly in the past one month.

For the unversed, Paytm's share price on February 1 saw huge selling pressure. Paytm shares opened lower at 608.80 apiece on BSE and touched a 20 per cent lower circuit within a few minutes of the stock market's opening bell.

The stock market experts believe that the restrictions imposed by RBI may impact the lending business of the fintech company, which generates around one-fifth of its net revenue.

The stock may continue to remain under pressure till the Paytm management makes an official announcement about the impact of the RBI’s restriction on its business, they noted.

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Published: 01 Feb 2024, 02:16 PM IST
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