Goldman Sachs Reinforces 'Buy' Rating on Paytm Amid Promising Market Recovery
Goldman Sachs maintains a 'Buy' rating on Paytm, setting a target price of ₹1,400, attributing projected growth to increased market share among consumers and merchants, resilient financial performance, and strategic decoupling from its associate entity's banking operations. Paytm's UPI and merchant app market shares are recovering steadily, indicating robust operational strength.
In a resounding endorsement, global brokerage giant Goldman Sachs has reiterated its 'Buy' rating on Paytm (One 97 Communications Ltd.), projecting a target price of ₹1,400. This valuation reflects a potential upside of approximately 22% from current levels. The brokerage cites Paytm's sustained market share growth across consumer and merchant segments as pivotal factors contributing to their optimistic outlook.
The analysis from Goldman Sachs anticipates another strong operational performance for Paytm in the fourth quarter of the fiscal year 2026. Key metrics include a projected gross merchandise value (GMV) growth of nearly 26% year-over-year, up from 23% in the third quarter. Despite facing temporary revenue challenges due to the absence of PIDF incentives, Paytm's underlying EBITDA performance is expected to remain robust, maintaining a margin of 5.8%.
Delving into the financial health of Paytm, the brokerage highlights a strong trajectory for its financial services vertical, with revenue growth forecasted at 33% YoY. A significant turnaround is observed in Paytm's lending momentum, with its outstanding loan book experiencing an accelerated growth of 11% QoQ in Q4 2026, compared to a modest 2% in Q3. While regulatory challenges exist, Goldman Sachs emphasizes that these actions pose limited implications, as Paytm has strategically reduced its reliance on its associate entity PPBL over the past two years.
(With inputs from agencies.)
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