{"id":77761,"date":"2022-12-14T17:55:00","date_gmt":"2022-12-14T12:25:00","guid":{"rendered":"https:\/\/tradebrains.in\/features\/?p=77761"},"modified":"2022-12-14T17:50:14","modified_gmt":"2022-12-14T12:20:14","slug":"paytms-buyback-is-hardly-a-solace-heres-what-analysts-are-saying","status":"publish","type":"post","link":"https:\/\/tradebrains.in\/features\/paytms-buyback-is-hardly-a-solace-heres-what-analysts-are-saying\/","title":{"rendered":"Paytm\u2019s buyback is hardly a solace; here\u2019s what analysts are saying"},"content":{"rendered":"<div class=\"trade-content_2\" style=\"margin-left: auto;margin-right: auto;text-align: center;\" id=\"trade-1718188012\"><p><a href=\"https:\/\/tradebrains.in\/get\/telegram\/\"><img decoding=\"async\" class=\"alignnone wp-image-101992\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2023\/01\/telegram-channel-300x119.png\" alt=\"\" width=\"148\" height=\"59\" \/><\/a> <a href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMN3Epgswxc--Aw?hl=en-IN&amp;gl=IN&amp;ceid=IN%3Aen\"><img decoding=\"async\" class=\"alignnone wp-image-123430\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-300x82.png\" alt=\"follow-on-google-news\" width=\"222\" height=\"61\" srcset=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-300x82.png 300w, https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-150x41.png 150w, https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news.png 468w\" sizes=\"(max-width: 222px) 100vw, 222px\" \/><\/a><\/p>\n<\/div><p>One97 Communications, the parent company of payments solutions firm Paytm, on December 12 approved a share buyback plan of \u20b9 850 crores, priced at \u20b9 810 per share. Its shares were trading at \u20b9 530 levels on Wednesday.&nbsp;<\/p><div class=\"trade-content_7\" style=\"margin-left: auto;margin-right: auto;text-align: center;\" id=\"trade-3222368057\"><!-- Composite Start --> \r\n <div id=\"M923760ScriptRootC1549812\"> \r\n <\/div> \r\n <script src=\"https:\/\/jsc.mgid.com\/t\/r\/tradebrains.in.1549812.js\" async> \r\n <\/script> \r\n <!-- Composite End --><\/div><p>\u201cThe approval of the Board be and is hereby granted for the buy-back by the Company of its fully paid-up equity shares having a face value of \u20b9 1 (Rupee One only) each (the \u201cEquity Shares\u201d) from the existing shareholders of the Company, pursuant to the open market route through the stock exchange mechanism (i.e., through the Stock Exchanges), at a price not exceeding \u20b9 810\/- (Rupees Eight Hundred and Ten only) per Equity Share (the \u201cMaximum Buyback Price\u201d) payable in cash, for an aggregate amount up to \u20b9 850 crores (Rupees Eight Hundred and Fifty crores only) (the \u201cMaximum Buy-back Size\u201d)\u201d, the company informed the bourses.&nbsp;<\/p><p>Paytm\u2019s shares gained 5.74% in December, so far. It reported an improvement in its monthly operating metrics in terms of its lending business and merchant subscriptions.&nbsp;<\/p><p>Analysts at JP Morgan said that the buyback could support the Paytm stock in the near-term.They expect Paytm to burn $33 million in cash over the next three quarters, but reach adjusted EBITDA (earnings before interest, taxes, depreciation and amortisation) breakeven in Q2 FY24.&nbsp;<\/p><div class=\"trade-content_5\" id=\"trade-2042313709\"><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-4023722985638610\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- in_content_2_news -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-4023722985638610\"\r\n     data-ad-slot=\"7925020301\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><\/div><p>\u201cGenerally, buybacks are conducted when corporates feel that their stock is undervalued. Apart from that, it is a tax-efficient way of returning money to shareholders. If a newly-listed platform company is considering buybacks even as they work towards profitability, it\u2019s a function of its confidence in its business prospects. It\u2019s also a question of whether they may not need to burn further cash and they believe that buying back shares at the current valuation could be more attractive.\u201d MD Krishna Kumar Karwa from Emkay Global Financial Services.&nbsp;<\/p><p>However, other analysts say that Paytm\u2019s buyback is hardly a solace, especially for those investors who bought its shares during the IPO at \u20b9 2150 apiece. While the market did not expect the buyback price to be anywhere near the IPO price, it expected a better premium.&nbsp;<\/p><p>Paytm will be buying back its shares at a <strong>price not exceeding <\/strong>\u20b9 810 and for an aggregate amount of <strong>up to <\/strong>\u20b9 850 crores. This means that it is free to buy at a lower price than this and buy any quantity of shares within the approved number.<\/p><p>It informed the exchanges that the minimum buyback size is \u20b9 425 crores and it will purchase a minimum of 52,46,913 equity shares. Therefore, analysts say that there\u2019s nothing much for IPO investors who bought the shares at \u20b9 2150 and ~75% of their capital has eroded.&nbsp;<\/p><blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p><strong>Written by Simran Bafna\u00a0<\/strong><\/p><\/blockquote><h4 class=\"wp-block-heading\" id=\"h-disclaimer\"><strong>Disclaimer<\/strong><\/h4><div class=\"wp-block-image\"><figure class=\"aligncenter size-full is-resized\"><img decoding=\"async\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2022\/02\/warning-disclaimer.png\" alt=\"\" class=\"wp-image-26306\" width=\"256\" height=\"256\"\/><\/figure><\/div><p><strong>The views and investment tips expressed by investment experts\/broking houses\/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.<\/strong><\/p><div class=\"trade-after-content\" id=\"trade-2127047254\"><div id=\"taboola-below-article-thumbnails\"><\/div>\r\n<script type=\"text\/javascript\">\r\n  window._taboola = window._taboola || [];\r\n  _taboola.push({\r\n    mode: 'alternating-thumbnails-a',\r\n    container: 'taboola-below-article-thumbnails',\r\n    placement: 'Below Article Thumbnails',\r\n    target_type: 'mix'\r\n  });\r\n<\/script>\r\n<script type=\"text\/javascript\">\r\n  window._taboola = window._taboola || [];\r\n  _taboola.push({flush: true});\r\n<\/script><\/div>","protected":false},"excerpt":{"rendered":"<p>One97 Communications, the parent company of payments solutions firm Paytm, on December 12 approved a share buyback plan of \u20b9 850 crores, priced at \u20b9 810 per share. Its shares were trading at \u20b9 530 levels on Wednesday.&nbsp; \u201cThe approval of the Board be and is hereby granted for the buy-back by the Company of [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":15085,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[31,1789],"tags":[],"class_list":["post-77761","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","category-trending-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v20.5 (Yoast SEO v25.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Paytm\u2019s buyback is hardly a solace; here\u2019s what analysts are saying - Trade Brains Features<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/tradebrains.in\/features\/paytms-buyback-is-hardly-a-solace-heres-what-analysts-are-saying\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Paytm\u2019s buyback is hardly a solace; here\u2019s what analysts are saying\" \/>\n<meta property=\"og:description\" content=\"One97 Communications, the parent company of payments solutions firm Paytm, on December 12 approved a share buyback plan of \u20b9 850 crores, priced at \u20b9 810 per share. 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