Paytm Share Price Rises As Analysts See Profitability On Horizon — Here's Why

One97 Communication Ltd.'s shares gained on Wednesday after analysts said that the Paytm payments platform operator would become profitable soon through cost optimisation efforts amid a gradual recovery in business. They views followed the Vijay Shekhar Sharma-led company reporting marginal improvement in most of the business metrics in July–September, compared to the first quarter.

In other news, One97 Communication also finally received approval from the National Payments Corporation of India for adding new UPI users. This will help Paytm in adding new users to improve business quality, Emkay Global Research said in a note on Wednesday.

The brokerage retained its 'add' rating on the stock with a target price of Rs 750 apiece, implying an upside of 10% to the previous close.

NPCI's approval will allow Paytm to arrest the decline in its user base and subsequently boost investors' expectations of favourable outcomes based on other regulatory stances, Bernstein said in a note on Wednesday. It maintained an 'outperform' on Paytm shares with a target price of Rs 600, implying a 12% downside from Tuesday's closing price.

Overall business recovery remained slow in all segments, Emkay Global Research said. Its payment gross merchandise value rose 5% on the quarter and declined 1% on the year, it said.

Motilal Oswal Financial Services estimated One 97 Communications to turn Ebitda positive by financial year 2027. The brokerage expects the recovery will continue with revenue growth at 24% CAGR for the financial year 2025–2027. The brokerage kept the rating on Paytm unchanged at 'neutral', with a targert price of Rs 700 apiece, as it awaits more clarity on business growth recovery.