PayTM closed today at INR 674.80, less than a third of its November IPO pricing of INR 2150.

PayTM (NSE: PAYTM), the Indian fintech, made waves with its November listing of shares issued at INR 2150. Vijay Shekhar Sharma, the founder, was in joyful tears at the conclusion of the IPO. In the four months since, the stock has been on a one-way ticket downhill, and today it gapped down at the open and closed at an all-time low.

A storm of bad news has engulfed the company and Sharma, and there’s fresh cause for investors to be teary-eyed, too.

The company in the past few days

• March 11, 2022: The Reserve Bank of India, India’s central bank, directed Paytm Payments Bank Ltd to stop, with immediate effect, onboarding of new customers. The bank was also directed to appoint an IT audit firm to conduct a comprehensive System Audit of its IT system. “Onboarding of new customers by Paytm Payments Bank Ltd will be subject to specific permission to be granted by RBI after reviewing report of the IT auditors,” the RBI said. The Payments Bank has over 300 million wallets and 60 million bank accounts, according to its website.
• March 13, 2022: The Delhi Police arrested Paytm founder Vijay Shekhar Sharma for allegedly ramming his car into the vehicle of South Delhi deputy commissioner of police (DCP) last month. Sharma was released on bail the same day.
• March 14, 2022: The Economic Times quoted a Bloomberg report as follows: The RBI barred Paytm Payments Bank from taking on new customers on March 11 because it had allowed data to flow to servers abroad in violation of India’s rules, and didn’t properly verify its customers, Bloomberg reported on Monday, citing a person familiar with the matter. Allegedly, the company’s servers were sharing information with China-based entities that indirectly own a stake in Paytm Payments Bank.
• March 14, 2022: Morgan Stanley downgrades Paytm to ‘equal-weight’, target price slashed; rising regulatory uncertainty weighs.
• March 14, 2022: Macquarie’s successively bearish pronouncements regarding the Indian fintech and its target price have proved uncannily correct. Today, the price breached its most recent target of INR 700.
• March 14, 2022: Vijay Shekhar Sharma denies reports regarding data flowing abroad: “The systems are in India. The access to the systems is governed by the IT rules and regulations of India and in turn further stringently and strictly according to what RBI guidelines say. The Paytm Bank has not ever in the past or now at any moment, given any unauthorised access to any bank system to any non-authorised person, forget to a foreign national.”

Watch this space for more developments.

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