Paytm Stock Falls 1% After Board Rejects Bonus Issue Proposal

The shares of One97 Communications, the parent company of Paytm, fell nearly 2% in trade on Tuesday, July 21, even after posting a strong financial performance for the quarter ended June 2026 (Q1 FY27).

However, the decline in the fintech major's share price comes after the board of directors rejected the bonus issue proposal, including the cautious stance of global brokerage house CLSA.

The company posted a net profit of Rs 220 crore for the quarter, marking a 79% increase from Rs 123 crore reported in the corresponding period last year. Excluding the impact of the PIDF incentive, comparable profit after tax (PAT) surged 207% to Rs 212 crore from Rs 69 crore a year earlier.

The earnings growth was aided by string operating leverage, expansion in the company's high margin payments and financial services businesses, and improved cost effectiveness, with revenue growing at a faster pace than operating expenses.

One97 Communications, the parent company of Paytm, stock fell 1.4% to ₹1,328.80 in intraday deals on Tuesday, July 21, even after it reported a strong financial performance for the quarter ended June 2026 (Q1 FY27) after market hours on Monday, as sustained momentum across its core businesses led to a sharp rise in profitability.

The board of directors said it remains committed to compounding growth and profitability to deliver long-term shareholder value and, after due deliberation, concluded that prioritising business growth is in the best interests of shareholders.

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Q1 Highlights

The company's revenue from operations rose 28% year-on-year (YoY) to Rs 2,448 crore from Rs 1,918 crore in the corresponding quarter of the sam year. On a sequential basis, revenue rose 8% from Rs 2,264 crore posted in the quarter ending March.

The growth was primarily driven by the company's Payment Services business, where revenue rose 33% YoY to Rs 1,384 crore, supported by higher merchant payment volumes and the continued expansion of its payments ecosystem.

The company's profitability improved sharply during the quarter, with the company reporting its highest-ever EBITDA, surging 182% year-on-year to ₹203 crore from ₹72 crore in the corresponding period last year. The EBITDA margin also expanded to 8% from 4%.

As of 10:43 AM, the shares of Paytm was trading were 1.98% at Rs 1,320 apiece.