Paytm shares rose 7.3% to ₹1,925, their highest close since listing in 2021, amid optimism that merchant discount rate charges could lift margins. The company reported…
**Paytm Shares Near Listing-Day High**
Paytm shares closed 7.3% higher at ₹1,925 on Thursday, the strongest close since the company listed in November 2021. The stock has now recovered 100% from its March lows and sits close to its debut price of ₹1,950. The parent entity, One 97 Communications, had raised ₹18,300 crore through its IPO at ₹2,150 per share.
**What Is Driving The Rally**
Investor sentiment has improved on expectations that merchant discount rate (MDR) charges may soon apply to UPI transactions. The National Payments Corporation of India has indicated that MDR would take effect immediately after Diwali, with the revised effective date to be notified separately. Analysts view MDR as a structural positive for the digital payments sector, especially for firms with large UPI merchant-acquiring operations.
The company's September-quarter results added to the momentum. Net profit came in at ₹226 crore, up 976% year-on-year from ₹21 crore. Revenue from operations rose 28.5% to ₹2,648 crore, compared with ₹2,061 crore a year earlier. Mutual fund holdings climbed to a record 21.17% across 43 schemes, up from 17.94% in the June quarter. Foreign institutional investors held 43.5%, while retail investors accounted for about 27%.
**Why It Matters For Businesses**
The recovery follows a difficult period after the Reserve Bank of India's 2024 restrictions on Paytm Payments Bank. The company has since refocused on core payments and financial services distribution, onboarding higher-quality merchants and expanding fee-based revenue. For merchants and payment aggregators, clarity on MDR could reshape pricing arrangements and compliance obligations. The stock has gained about 220% from its 2024 lows, 28% in the following year and roughly 48% so far this year.
**What To Watch Next**
The key trigger is the formal NPCI notification on MDR implementation, which will determine how charges are levied and collected. Readers should also track whether the September-quarte…
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