Paytm Stock: SoftBank Sells 2% Stake; Paytm Shares Down By 4 %

It held a 17.5% stake in Paytm in September 2022 later it trimmed its ownership through multiple open market deals. After this sale, the company's stake in Paytm’s parent One97 Communications went down to 2.83 percent from 5.01 per cent earlier.

SoftBank sold more than 13.7 million shares, i.e. 2.17 percent in Paytm after a regulatory crisis.Paytm informed the stock exchange that SVF India Holdings (Cayman) sold 12,784,787 Paytm shares, which account for 2.17 per cent stake in the Paytm Parent company.

It held a 17.5% stake in Paytm in September 2022 later it trimmed its ownership through multiple open market deals. After this sale, the company’s stake in Paytm’s parent One97 Communications went down to 2.83 percent from 5.01 per cent earlier.

“SVF India Holdings (Cayman) Limited has disposed of an aggregate of 13,784,787 equity shares of One97 Communication Limited in a series of disposals undertaken between January 23,2024 and February 26, 2024, with a disposal on February 26, 2024 breaching the 2% threshold specified in Regulation 29 (2) of the SEBI Takeover Regulation,” the firm said in a statement, reported Money Control

Shares of Paytm was trading down by 4 percent at ₹391.15 today after the annoucment of SoftBank sell of stake. The company stock earlier fell by 48.5 percent in value since the Reserve Bank of India’s order on January 31.

In December and January, SoftBank sold a 2 per cent stake in the company, bringing it down to just 5 per cent and after today’s sale it has gone down to 2.83 percent.

Warren Buffett’s Berkshire Hathaway and China’s Alibaba Group already exited the firm in 2023 and a unit of Chinese fintech firm Ant Financial had also cut their stake.

Business Standard reported that SoftBank Group suffered a loss of 10% on its $1.4 billion investment on which it had invested at the rate of Rs 820 a share in May 2017.

Paytm CEO Vijay Shekhar Sharma resigned as non-executive chairman and board member of Paytm Payments Bank. Paytm has been in trouble since a month now, starting from the regulatory challenges faced by the digital payments giant.

Due to persistent non-compliance and ongoing supervisory concerns, the Reserve Bank of India has prohibited Paytm from accepting deposits and credits from any customer after March 15.

The regulatory hurdles faced by Paytm have impacted its stock value and caused a significant decline following the RBI’s directive. However, signs of recovery have emerged, attributed partly to Paytm’s collaborations with new banking entities and the RBI extending the deadline for winding down the payments bank’s operations.

Mr Sharma owns a 51 per cent stake in Paytm Payments Bank. He has transformed Paytm into India’s leading mobile-first financial services

(With Agency Inputs)