Paytm Gets First ‘Buy’ Rating Following Rocky IPO 

The Indian super app Paytm received its first buy rating this week, following a less-than-stellar debut last month on the country’s stock exchange. 

As Bloomberg News reported Thursday (Dec. 2), the brokerage firm Dolat Capital Market Pvt. has given Paytm its buy rating, saying it expects the company to reach profitability by March 2026. Dolat said Paytm’s move to a financial services “manufacturer” from an agent that cross-sells services, coupled with robust user growth, will buoy the company. 

Paytm began as a payments app but has since pivoted to offer things such as insurance, plane tickets, banking and other services. 

Read more: Paytm Shares Plunge in India’s Market Debut

Dolat analysts say Paytm has moved from a “want” to “need” status, positioning the company as “one of the strongest digital brands to garner significant share of opportunities that will evolve in the Indian internet ecosystem.” 

Bloomberg said the brokerage set a target price of 2,500 rupees, or $33.40, which is 16% higher than Paytm’s issue price. The companies shares fell as much as 2.7% Thursday, marking its fifth day of declines. 

Paytm’s parent company, One97 Communications, raised $2.5 billion on what was India’s largest IPO ever, only to see shares tumble 25% on the opening day of trading last month. The company is backed by some major global investors, including SoftBank, Ant Group and Berkshire Hathaway.

Paytm announced its first financial results as a publicly traded company last weekend, showing losses of 4.74 billion rupees ($63 million) in the July to September quarter compared to a year ago, fueled by a rise in expenses. Revenue were up more than 60%, thanks to growth in its financial, cloud and commerce services. 

See also: Paytm Founder Says Company’s Public Debut Mirrors Tesla’s 

Last month, Paytm founder Vijay Shekhar Sharma compared the company’s dismal debut to what Tesla went through when it first listed. 

During a four-hour-long company meeting, Sharma told employees to learn from the carmaker’s initial struggles and aim for a similar rebound by focusing on market expansion.