As expected, shares of One97 Communications, the parent company of fintech firm Paytm, nose-dived on Monday to hit a fresh 52-week low.
Share of Paytm at 10 am was exchanging hands at Rs 683 a piece, down 12% from Friday' closing. It touched a low of Rs 672 on the NSE during the early trading hour.
With the current fall, Paytm shares have lost more than two-thirds of their value when compared with the issue price of Rs 2150. Similarly, its market capitalisation has now come down to around Rs 44,200 crore as against the m-cap of Rs 1.39 lakh crore before the stock hit the exchanges.
Shares of Paytm entered the stock exchanges in November last year, at a discount of over 9% and fell over 20% in the first 15 minutes of trading. The stock ended its first session 27% lower at Rs 1,564.
Brokerage firm Macquarie has maintained a target price of Rs 700 with an 'underperform' rating on Paytm.
The fresh fall comes after the Reserve Bank of India (RBI) has barred Paytm Payments Bank from onboarding new customers with immediate effect due to supervisory concerns. The top bank has directed the bank to appoint an IT audit firm to conduct a comprehensive system audit of its IT system.
“Reserve Bank of India has today (March 11), in exercise of its powers, inter alia, under section 35A of the Banking Regulation Act, 1949, directed Paytm Payments Bank Ltd to stop, with immediate effect, onboarding of new customers. The bank has also been directed to appoint an IT audit firm to conduct a comprehensive System Audit of its IT system,” said RBI in a circular on Friday.
It added that the onboarding of new customers by Paytm Payments Bank will be subject to specific permission to be granted by RBI after reviewing report of the IT auditors. This action is based on certain material supervisory concerns observed in the bank, it said.
While the RBI did not mention why it is barring the firm to onboard new customers, it is not the first time the regulator has taken a similar step. In August 2018, it was reported that Paytm Payments Bank had stopped enrolling new customers following an audit by RBI, which revealed that the firm was not following adequate know-your-customer (KYC) norms when it comes to acquiring new customers.