•Digital payments firm Paytm saw its stock decline markedly after a shareholder offloaded 19.20 million shares.
•Reports indicated that the likely seller in the Paytm block deal is Alibaba Group affiliate Ant Financial and the monetary value of the sale was around $125 million.
•Paytm’s stock was trading down 5% from its previous close on the Bombay Stock Exchange (BSE) as of press time.
Paytm, a digital payments and financial services platform, recently experienced a sharp decline in its stock prices following the offloading of 19.20 million shares by a shareholder. This has been identified as Alibaba Group affiliate Ant Financial, with reports estimating the monetary value of the sale to be around $125 million. The offload was recorded by parent One97 Communications Ltd., and Morgan Stanley (NYSE: MS) reportedly advised Alibaba in the deal.
Paytm’s stock was trading down 5% from its previous close on the Bombay Stock Exchange (BSE) as of press time. This marks the steepest plunge in the company’s stock since November 22nd, with the stock trading at Rs 528 a share. Additionally, prior to this development, the stock had accrued 15% since December 26th. This indicates a stark contrast in performance, giving an indication of the impact of the offload on Paytm’s stock.
The sale of 19.20 million shares by Ant Financial was likely to reduce its stake in the company. As of September 2020, Ant Financial had a 24.88% stake in the company, with the value of the stake being 164.42 million shares. It is yet to be confirmed whether Ant Financial had completely offloaded its stake or if the shareholder had just reduced their stake.
The decline in Paytm’s stock is a stark contrast to their previous performance, and the future of the company remains uncertain. It is likely that the company’s stock prices will continue to remain volatile in the near future as investors assess the impact of the offload on the company’s performance. It is yet to be seen whether Ant Financial’s offload will have a lasting impact on Paytm’s future performance.