Why Paytm Is falling? Rise and fall of Paytm
Friends, you must know the story of Paytm. company share price has been declining in the last few days. After listing, the value of the company’s stock has dropped by as much as 70%. In which some people say that if the price of stock has gone down then look at buying. And some say the company has no business model. Today we will discuss on the same topic how company is going to be filed.
There are only two things that company is doing right now, 1. Fastag 2. Paytm Payment Bank. Fastag is within Paytm Payment Bank. Paytm Bank has 28% market share in Fastag. Paytm Bank is the only entity that is profitable. In 2020, the company made a profit of Rs 29 crore, and in 2021 profit of 37 crores. But Paytm Bank is often banned from creating new customers.
You must know the name of the owner of the company. Yes friends we are talking about the founder of Paytm Company. His name is Vijay Shekhar Sharma. Before this company he also had a company called ONE97.
Paytm Bank Violating RBI Rules
In the year 2016, company got the license of Payments Bank, And in 2017, the operation of Paytm Bank started. In 2018, for the first time, when a new customer was onboard, Paytm was banned by RBI.
The reason was that the RBI had noticed KYC related shortcomings. But in a short time, that Paytm solved that problem. And now, in 2022, the new customer has been banned for onboarding. After that the share price of the company will come down by more than 20%.
What is Truth of Paytm Fall?
Some people believe that Paytm Payment Bank is the reason for the decline in the value of the stock. But this is totally wrong. Friends, when the IPO of Paytm came, the valuation of the company was Rs 1.39 lakh crore. The company was making a loss then. At that time the revenue of the company was around 3300 crores.
Why is PayTM Stock Falling?
Paytm is a fintech company. The company’s revenue is not growing as fast as it should, The valuation of the company is very high. New customer has also been banned by RBI. At present the condition of the investor of the company is very bad. No one has any idea how the company will be profitable. The price of the company’s stock is declining day by day.
The company has expanded its business into many other services, Such as payment service, cloud & commerce, financial services, etc. But there are restrictions where there was a lot of profit. There was a lot of service available from one of their apps Such as Shopping, Bill Payments, Gaming, Food Order, buy Insurance, etc. The company wanted to create a super app but it did not make a profit.
A lot of apps in the market are going to be super apps like PhonePay, WhatsApp. The company’s losses are also on the rise. It was the largest IPO when Paytm’s IPO came out. But when it was listed on market, it suddenly crashed. According to a research, the valuation of a company is 26 times higher.