The current fiscal year’s third quarter (Q3FY25) saw mutual funds dramatically raise their ownership of One 97 Communications, the parent company of Paytm, to an all-time high.
Twenty-seven mutual funds owned 11.20% of Paytm as of the end of December 2024, or 7.14 crore shares. Compared to the 7.86% stake held after the previous quarter in September, Trendlyne’s shareholding data shows significant growth.
Over time, mutual funds have been progressively purchasing Paytm stock, with the most significant increase in the recent quarter. Among the significant mutual funds that increased their ownership of the new-age stock are Motilal Oswal Mutual Fund, which now owns 2.11% of the firm, Nippon Mutual Fund, which owns 2.32%, and Mirae Asset Mutual Fund, which currently owns 4.17%.
In the same way, foreign investors increased their business ownership to 56.2% in the December quarter, a significant increase from 55.55% in the September quarter. In contrast, retail investors reduced their ownership from 36% in the September quarter to 31.9% in Q3FY25.
The stock has increased by 48% throughout the quarter, the second-largest quarterly performance since it was listed in November 2021.
Additionally, the company’s shares had the most considerable annual increase ever after CY24, a remarkable 60% rise. Furthermore, the stock jumped 230% from a record low of ₹310 per share to ₹1,017, making it the most excellent turnaround stock in 2024.
The stock reached ₹1,062, the highest level since January 2022, after surpassing the ₹1,000 threshold in early December. The company’s increasing prospects across all of its business areas are responsible for this comeback, which boosted investor confidence in its growth trajectory and revitalized investor sentiment.
Pressure to Sell Arises as UPI Struggles
However, when the most recent December NPCI data revealed that Paytm had trouble with its UPI transactions in December 2024, the company has recently been under selling pressure. At ₹1.25 trillion, its transaction volume was 1.15 billion.
In contrast, PhonePe reported 7.98 billion UPI transactions in December, equivalent to ₹11.76 trillion. With 6.1 billion UPI transactions, or ₹8.22 trillion, Google Pay came next.
Last month, PhonePe had the largest market share by transaction volume (47.7%), followed by Google Pay (36.7%) and Paytm (6.87%). In response to this revelation, the shares have fallen by about 20% this month, to ₹817.9 per.
On January 20, 2025, Paytm is expected to release its Q3FY25 earnings. The firm, helmed by Vijay Shekhar Sharma, recorded its first profit since its IPO in 2021, with a net profit of ₹928 crore for Q2FY25.
However, the ₹1,345 crore gain from selling its ticketing business to food delivery startup Zomato was the main driver of this result.
