The brokerage firm Bernstein has reportedly given Paytm an 'Outperform' rating and set a target price of Rs 600 per share. According to the brokerage, the Reserve Bank of India's (RBI) actions are primarily targeted at Paytm Payments Bank (PPBL), with no aim to disrupt other essential operations of Paytm. This differentiation is pivotal in grasping the extent of regulatory actions affecting the company, according to a report from ET Now.
Bernstein emphasised that linking merchants' operations to a non-PPBL bank represents a "significant positive" with substantial advantages for Paytm. The brokerage also recognised the extension of the cut-off date from February 29 to March 15, offering Paytm an extended timeframe to enact essential changes in compliance with regulatory demands.
On the downward front, Bernstein highlighted the absence of action regarding the bulk transfer of wallets and FASTags to another bank. This limitation may present challenges for Paytm in overseeing certain facets of its financial operations.
On Friday, the RBI extended the deadline for halting deposit transactions at PPBL, a part of One 97 Communications operating the digital payments firm Paytm, until March 15. This decision, made in the public's interest, is aimed at accommodating the requirements of the payment bank's customers and merchants, who may require additional time to make alternative arrangements.
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“No further deposits or credit transactions or top-ups shall be allowed in any customer accounts, prepaid instruments, wallets, FASTags, National Common Mobility Cards, etc. after 15 March (extended from the earlier stipulated timeline of 29 February), other than any interest, cashback, sweep in from partner banks or refunds which may be credited anytime," RBI said on Friday.
On January 31, the RBI directed PPBL to cease accepting deposits or top-ups in customer accounts, wallets, FASTags, and other instruments after February 29, citing significant non-compliance with regulations and supervisory concerns.
