Paytm shares fall 4% after payment bank CEO quits

One 97 Communications has also informed the exchanges that all relations with PPBL have been snapped by Paytm and that the board of the bank has been reconstituted with five independent directors along with an independent chairperson.

Chawla sent in his resignation on Monday, citing personal reasons and to pursue “better career prospects”, the filing mentioned. His last working day will be June 26.

Chawla had joined the payment bank on January 9 last year. Prior to that, he was with as the head of branch banking.

At 10.09 am, the stock was trading 1.3% lower at Rs 398.8 on BSE. The stock has also declined 42% in the last three months, and nearly 60% in the past six months.

Meanwhile, Bank of America (BofA) has resumed its coverage on Paytm with an 'underperform' rating and a target price of Rs 400.

The company which operates Paytm is expected to witness a gradual growth in its lending business, the brokerage said in a review note.

BofA sees high competition in the payments business for Paytm while estimating a weak set of numbers for the fintech company when it announces its fourth-quarter earnings. It has attributed this to the Reserve Bank of India action.

Earnings recovery and re-rating could be 2-3 quarters away, BofA said, expecting the estimates to bottom by Q1FY25 as the full impact of the three-month ban on business would become visible.

In terms of technicals, the relative strength index (RSI) of the stock stands at 46.5, signaling that it's neither trading in the overbought nor in the oversold territory. MACD is at -10.7, which is below its Center Line which is a bearish indicator.

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