One 97 Communications Ltd, operating the Paytm brand, has solidified its position as a majority Indian-owned entity. As of March-end 2026, domestic investors have increased their combined stake to 50.3 per cent. This shift underscores a significant structural change in ownership, reflecting growing institutional confidence in the fintech giant.
Domestic Investors Fuel Ownership Shift
The surge in domestic shareholding marks a key development for the company. Regulatory filings show that domestic institutional investors raised their stake to a record 23.1 per cent in the March quarter. This represents a sharp increase of 2.8 percentage points sequentially, and 9.1 percentage points from the previous year.Mutual funds spearheaded this heightened interest, raising their holdings to 16.6 per cent from 14.3 per cent in the last quarter. Furthermore, the number of funds invested in the company grew to 41, up from 36. Key players like Motilal Oswal Mutual Fund, Mirae Asset, and Bandhan Mutual Fund were among those expanding their positions.
The insurance sector also significantly contributed to the ownership increase. Combined, insurance companies raised their stake to 5.1 per cent, up from approximately 4.8 per cent. Major players in this space, including Tata AIA Life Insurance and SBI Life Insurance, increased their exposure to the firm.
Robust Financial Performance Underpins Growth Trajectory
The rising ownership coincided with notable improvements in the company's operational performance. Paytm reported its third consecutive profitable quarter in the December quarter. In that quarter, the company posted a net profit of Rs 225 crore.Revenue also demonstrated robust growth, rising 20 per cent year-on-year to reach Rs 2,194 crore. EBITDA stood at Rs 156 crore, maintaining a strong margin of 7 per cent. On the business front, the company’s merchant base continued its expansion, with subscription merchants crossing 1.44 crore, a 24 per cent increase year-on-year.
Analysts Highlight Monetization and Merchant Advantage
Brokerages are citing improving fundamentals across the board, particularly in the lucrative areas of merchant payments and lending. Bank of America recently upgraded the stock, emphasizing the company's leadership in higher-monetization segments and its improving profitability trajectory.The brokerage maintained a 'Buy' rating on the stock, citing favourable risk-reward, and set a target price of Rs 1,380. It noted that Paytm is strong in B2B and is ahead in its monetization journey due to a diversified business mix and better margins.
Bernstein also maintained a positive outlook, noting the company’s superior monetization advantage in the merchant business. They highlighted that Paytm’s merchant revenues are roughly twice that of its nearest competitor despite similar merchant payment volumes. The firm ascribed an outperform rating to the stock, suggesting the company is significantly further along the profitability curve.
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