Shares of troubled fintech One 97 Communications fell another 5% on Thursday to hit a fresh record low of Rs 325.30 on BSE after the Directorate of Enforcement (ED) quizzed Paytm Payments Bank officials in connection with its probe into alleged violations of Foreign Exchange Management Act (Fema) by entities using the bank.

Paytm has now lost about Rs 27,000 crore or 57% of its value in the last 11 days since the trouble began after RBI issued a ban on the payments bank which also houses Paytm wallet.

In an exchange filing last night, the fintech admitted that it has been receiving notices and requisitions over time for information, documents and explanations from ED, with respect to customers that may have done business with the respective entities.

“We would also like to clarify that our associate Paytm Payments Bank Limited does not undertake Outward Foreign Remittance,” it said.

Earlier in the day, ET reported that ED executives provided information and documents sought by the agency. ED has asked them to furnish more details by next week. “The information gathered so far and documents shared by Paytm Payments Bank prima facie does not exhibit violation of Fema so far,” a top government official told ET on condition of anonymity.

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Paytm stock outlook

Given the way Paytm shares have fallen in the last few days, experts suggest retail investors to stay away from the stock till the time the regulatory hurdles are over. Earlier, it was also reported that the RBI is planning to cancel the license of Paytm Payments Bank.Global broking firm Macquarie sees the stock slumping to as low as Rs 275. It is now the biggest bear on Paytm.”We cut revenues sharply as we reduce both payments and distribution business revenues (60-65% over FY25/26E). Moving payment bank customers to another bank accounts or moving related merchant accounts to other bank accounts will require KYC (Know your customer) to be done again based on our channel checks with partners, indicating that migration within RBI’s Feb 29th deadline will be an arduous task,” Macquarie analyst Suresh Ganapathy said.

Those who have been trying to catch the falling knife have burnt their fingers in the last few days.

“We are trying to catch a falling knife, as we say in market parlance, and it is always avoidable. As far as Paytm is concerned, the RBI direction has pretty much stopped the business of the payments bank. There is a whole lot of uncertainty. Some meetings are happening, but how far if at all remedial actions are approved by the regulator is a big question mark. As things stand today, customer confidence, and partner confidence obviously for obvious reasons have eroded completely. There is a clamour amongst customers and partners to move out,” said Sudip Bandyopadhyay of Inditrade Capital.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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