Shares of One 97 Communication Ltd, the parent company of Paytm, demonstrated recovery in the past two trading sessions, particularly bouncing back on Friday. The stock reached the upper circuit, rising by 5% on Friday. This recovery follows a recent low of Rs 310 on Thursday, with the stock climbing to Rs 349.95, marking a significant increase of 12.9% from its recent low.
During this period, the total market capitalization of Paytm stood at Rs 22,250 crore. Addressing reports regarding a lending partner, Aditya Birla Finance, invoking loan guarantees, Paytm refuted these claims, asserting that such reports were factually inaccurate. The company clarified that its personal loans distribution business remained unaffected and operational, continuing its collaboration with various banks and NBFCs.
Despite this recent uptick, Paytm has faced challenges on the stock market, witnessing a decline of approximately 69% from its 52-week high of Rs 998.30 in October 2023. Additionally, the stock has experienced a significant drop of over 85% from its IPO price of Rs 2,150.
Technical analysts have been closely monitoring Paytm's movements, noting its entry into an oversold zone amidst ongoing corrections. To signal a potential upward movement, Paytm needs to surpass its near-term resistance levels, particularly around Rs 360. A breakthrough accompanied by strong volumes and a potential gap-up scenario could pave the way for further gains towards Rs 400. Conversely, failure to surpass these levels may lead to fresh lows and a continued negative bias in the short term.
Avdhut Bagkar, a derivatives and technical analyst at StoxBox, attributed Paytm's notable recovery from all-time lows to the oversold condition the stock had experienced during recent sessions.
