NEW DELHI: China-based Alibaba has sold its remaining 3.3% direct stake in the fin-tech firm One97 Communications, which operates under the Paytm brand, in a block deal on Friday. As per the NSE data, it sold over 2.14 crore shares at an average price of 642.74. This would have fetched the Chinese firm about Rs 1,380 crore.
Paytm’s December 2022 shareholding pattern suggests Alibaba had a 6.26% stake in Paytm. Of this, it off-loaded a 3% stake in January and the remaining was sold on Friday. Alibaba through its affiliate firm Ant Financial still holds close to 25% stake in Paytm. The Chinese billionaire Jack Ma-founded company was one of the earliest investors in the fintech company.
Meanwhile, Morgan Stanley Asia (Singapore) bought over 54 lakh shares at an average price of Rs 640 in Paytm, showed the NSE data. It sold over 5 lakh shares in another block deal at a price of Rs 667.66. This exit by Alibaba comes days after Paytm reported its first-ever quarterly operating profit as a listed firm, leading to a rally of about 36% in its share prices in just 4 sessions. The stock, however, witnessed heavy selling pressure on Friday, ending at Rs 651, down 7.8% over its previous day’s close on the NSE.
Paytm shares continue to trade below its initial public offer (IPO) price of Rs 2,150 apiece. Since its listing in November 2021, the stock has lost about 60% due to valuation concerns. Paytm had on February 3 announced achieving its operating profitability milestone with EBITDA before ESOP cost at Rs 31 crore, ahead of its guided timeline of September 2023.
Paytm founder and CEO Vijay Shekhar Sharma said they have achieved this milestone without losing sight on growth opportunities and keeping compliances as well as risk factors under a strict watch. Sharma added that the next key milestone for Paytm is free cash flow generation. “With our focus on growth and keeping a tight vigil on operational risk and compliances, I am confident we will soon achieve our next milestone of becoming a free cash flow generating company,” he said.