Shares of Paytm parent One 97 Communications Ltd rallied nearly 6% to hit a fresh 52-week high on Wednesday after the Reserve Bank of India (RBI) granted its subsidiary approval to operate as a payment aggregator.

Cheering the news, Paytm shares jumped as much as 5.9% to hit a 52-week high of ₹1,186.50 on the BSE, while its market capitalisation climbed to ₹73,730 crore. The stock price of the fintech heavyweight has more than doubled from its 52-week low of ₹503.90 touched on August 13, 2024.

Vijay Shekhar Sharma-led Paytm Payments Services Ltd (PPSL), a wholly owned subsidiary of One 97 Communications, has received in-principle authorisation from the central bank to operate as an online payment aggregator under the Payment and Settlement Systems Act, 2007.

The licence will enable Paytm Payments Services to onboard new merchants, lifting the ban that had been in place since November 2022, when its earlier application was rejected.

This marks a turnaround for the fintech major, which had failed to secure RBI approval for its payment aggregator licence application in November 2022. The RBI had asked the company to first comply with FDI norms.

In an exchange filing last night, One 97 Communications said, “This is in furtherance to our stock exchange filing dated August 28, 2024, regarding the application filed by Paytm Payments Services Limited (PPSL), a wholly owned subsidiary of One 97 Communications, for a Payment Aggregator (PA) licence. We would like to inform you that the Reserve Bank of India has granted ‘in-principle’ authorisation to PPSL vide its letter CO.DPSS.AUTH.No.S532/02.27.004/2025-26 dated August 12, 2025, to operate as an online payment aggregator under the Payment and Settlement Systems Act, 2007.”

“It should be noted that this in-principle authorisation only covers online PA operations as defined in the PA-PG Guidelines, and transactions that do not fall under the ambit of the said guidelines, including ‘pay-out’ transactions undertaken on behalf of merchants, should not be routed through the escrow account designated for PA operations,” as per the RBI notification.

Post this development, JM Financial reiterated its ‘BUY’ rating on Paytm, saying that the approval marks a significant regulatory milestone for the company.

“As highlighted in our earlier note on regulatory triggers, we expected this to have a 5% benefit to Paytm’s FY27E EBITDA. However, this could be a big sentimental trigger as the approval likely becomes a precursor to further regulatory clearances for Paytm,” the brokerage said in a report.

The report noted that Paytm has seen a sharp reversal since January 2024 to report PAT profitability in Q1FY26. Furthermore, the improvement in contribution margin (mid-high fifties) along with a controlled rise in indirect expenses can potentially trigger a rapid rise in absolute profits for the company, with focus reverting to sustainable growth.

Moreover, there still remains the optionality of further regulatory triggers such as UPI monetisation and the Paytm wallet, each of which could result in a 25-30% rise in its EBITDA estimates, JM Financial said in its report.

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