Shares of One 97 Communications, the parent company of Paytm, declined over 8% in early trade today, even as the broader market remained positive. Sentiment was dented after the Reserve Bank of India (RBI) cancelled the banking licence of its associate entity, Paytm Payments Bank Ltd.

Weighed down by the development, Paytm shares dropped by as much as 8.37% to hit a low of ₹1,051.05 in the first two hours of trade on the BSE. The market capitalisation of the fintech heavyweight fell to ₹71,100 crore. On Friday, Paytm shares had closed 1.1% lower at ₹1,147.10, with a market value of ₹73,427 crore.

At current levels, Paytm shares are down 24% from their 52-week high of ₹1,381.75 touched on December 2, 2025, while they have risen 31% from the 52-week low of ₹803.10 hit on May 7, 2025. The stock has declined 14% on a year-to-date (YTD) basis but has gained nearly 26% over the past year.

Investors turned jittery even as the Vijay Shekhar Sharma-led fintech firm and analysts maintained that there would be no direct financial impact from the RBI’s action, as the company has no exposure to, or material business arrangements with, PPBL.

The payments bank is a joint venture between Vijay Shekhar Sharma, who holds a 51% stake, and One 97 Communications Ltd, which owns the remaining 49%.

Analysts see no impact on Paytm's core biz

Domestic brokerage Emkay Global said in a report that it does not expect any financial or operational impact on One 97 Communications, as all commercial agreements between Paytm and PPBL were terminated by March 2024, and the equity investment had already been fully impaired as of March 31, 2024. It added that the listed entity remains “legally ring-fenced” from the payments bank.

“The PPBL licence cancellation is largely a formality, as the entity has been in an effective run-down since February 2024, when fresh deposits were barred,” Emkay said.

The brokerage has maintained a ‘Buy’ rating on the stock with a DCF-based target price of ₹1,500, expressing confidence in Paytm’s execution in its core merchant payments and financial services business. It remains positive on the company’s outlook, citing strong growth potential in payments and financial services, along with optionalities such as BNPL, wallet expansion, and scaling of RuPay credit cards. It expects around 24% revenue CAGR over FY26-FY28.

The RBI had earlier directed PPBL to stop accepting deposits from January 31, 2024, and the latest move formally ends its banking operations. Emkay said the cancellation merely formalises the closure process.

Global brokerage Bernstein also reiterated that the latest developments are unlikely to impact Paytm’s business and could instead create new regulatory opportunities for the company. The brokerage maintained its ‘Outperform’ rating with a target price of ₹1,500, implying an upside potential of around 31% from current levels.

The brokerage added that the regulator’s decision is only an incremental development, as Paytm had already established a clear operational separation between the payments bank and the parent company following regulatory action in early 2024.

Meanwhile, One 97 Communications, in an exchange filing, reassured users and merchants that its platform will continue to operate without disruption. Its core offerings—including the Paytm app, UPI services, Paytm Gold, and merchant solutions such as QR codes, Soundbox devices, and card machines—remain fully functional. Other services, including its payment gateway and wealth management platform, Paytm Money, will also continue as usual.

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