Paytm Stock Rating: Bullish rating for Paytm shares for the first time, Morgan Stanley said – will climb up to 43 percent
When Paytm was listed in November, its shares fell 40 per cent below its issue price.
The poor performance of Paytm’s shares after the IPO had disappointed its investors. But now for the first time it has got a Bullish rating. Analysts of global brokerage firm Morgan Stanley have started its coverage for the first time and have given the rating of ‘Overweight’ to the parent company One97 Communications. The brokerage firm has kept the target price of Paytm shares at Rs 1875.
Paytm shares may climb up to 43 percent
Morgan Stanley says that the company’s shares can climb up to 43 percent from its current price. When Paytm was listed in November, its shares had fallen 40 per cent below its issue price. However, it is also interesting that Morgan Stanley has been involved in the book running of this IPO. At present, the current price of Paytm shares is Rs 1342. Its shares gained 2.45 percent on Wednesday.
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Why was the target price raised?
The brokerage firm says that Paytm’s revenue can grow by 43 percent in the next five years. In this, the share of financial services and commerce and cloud business will increase to 43 percent. At present it is 27 per cent. Its target price has been kept at Rs 3800 per share in a bullish environment. In such a situation, the revenue of Paytm can reach $ 260 billion by 2026. This will be 57 percent more than the base case.
In the bear case, the shares of Paytm can fall to Rs 800. In such a situation, its revenue can be 83 billion rupees. This can happen if there is a fall in the payment charges of wallet, credit card. Morgan Stanley believes that Paytm can get strong growth in its market. In the next five years, its commerce services can grow by 25 percent and reach $ 300 billion.
(Article: kshitij bhargava)
(The stock recommendations given in the story are those of the respective research analyst and brokerage firm. Financial Express Online takes no responsibility for the same. Investments in capital markets are subject to risks. Please consult your advisor before investing.)
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