On Thursday, the Paytm stock fell to Rs 1054 on the BSE, marking a new low. Macquarie downgraded the stock recently, which has led to further losses in trade.
Paytm's headwinds have not abated, says Macquarie, cutting its target price to Rs 900 from Rs 1,200 on Monday.
According to Macquarie, since November 18, 2021, the stock price of One 97 Communications or Paytm has dropped 40 percent against the flat Sensex.
Macquarie said, "In the wake of the various business updates and results, Macquarie pared down its revenue growth projections, particularly on the distribution side, from 26 percent to 23 percent for FY21-26E.For FY21-26E, our revenue estimates are being cut by about 10 percent on average every year due to lower distribution and commerce/cloud revenue offset by higher payment revenue".
In FY22-25E, the firm decreased our earnings (increased our loss projections) by 16-27 per cent as a result of lower revenues and higher employee and software expenses. It cut the target prices by 25 per cent as a result of a lower target price of 11.5x (from 13.5x earlier). In response to lower sales numbers and a lower target multiple of 11.5x (Price to Sales ratio), it cut our target price by 25 per cent.