Bernstein raises Paytm price target, stock hits new 52-week high
Fintech company Paytm's shares surged significantly after brokerage firm Bernstein upgraded the stock to 'Outperform' and raised its price target to ₹2,200.
Shares of fintech firm Paytm saw a significant rally on Tuesday, hitting a new 52-week high of ₹1,594.80 during intraday trading on the BSE.
The surge was driven by brokerage firm Bernstein initiating an 'Outperform' rating and significantly increasing its price target for Paytm's stock from ₹1,500 to ₹2,200. This new target suggests a potential upside of approximately 53% from the stock's previous closing price.
Bernstein has incorporated potential monetization of UPI Merchant Discount Rate (MDR) into its base-case estimates, expecting benefits from fiscal year 2028. The brokerage anticipates that MDR could improve Paytm's net payment margins by 3-4 basis points, potentially boosting its estimated earnings per share (EPS) for FY30 by 30% compared to earlier forecasts.
According to Bernstein, recent statements from India's Ministry of Finance and legislative changes indicate a shift in focus from the possibility of UPI MDR to its implementation timeline and methods. The brokerage firm has thus included UPI monetization in its core projections, anticipating positive impacts starting in FY28. Paytm's stock has gained approximately 23% year-to-date.