Wednesday, June 29, 2022
HomeBusinessPaytm Shares Nosedive After Regulatory Ban, CEO Arrest

Paytm Shares Nosedive After Regulatory Ban, CEO Arrest


Paytm shares nosedive after regulatory ban, CEO arrest

Paytm shares nosedived nearly 13 p.c Monday after Indian regulators banned the beleaguered funds platform from enrolling new clients and reviews emerged that its founder was arrested for crashing right into a police automobile.

The agency loved India’s largest preliminary public providing 4 months in the past, with the backing of Chinese tycoon Jack Ma’s Ant Group and Warren Buffett’s Berkshire Hathaway.

But it has since lost greater than two-thirds of its market cap regardless of a commanding place within the native digital funds area, as traders fret over whether or not the perennial loss-maker will ever flip a revenue.

India’s central financial institution demanded Paytm instantly cease enrolling new clients on Friday and ordered an audit of its IT programs, citing “certain material supervisory concerns observed in the bank”.

Shares within the agency closed 12.84 p.c decrease in Mumbai after hitting file lows in Monday’s commerce.

Paytm mentioned it “remains committed to working with the regulator to address their concerns as quickly as possible”.

The agency’s troubles had been compounded over the weekend after information broke that founder and chief govt Vijay Shekhar Sharma had been briefly detained final month after crashing right into a senior police officer’s automobile within the capital New Delhi and fleeing the scene.

Paytm downplayed the incident in a Sunday assertion that characterised the accident as a “minor offence”. 

Mr Sharma, named India’s youngest billionaire in 2017, launched Paytm in 2010 and rapidly made the platform synonymous with digital funds in a rustic historically dominated by money transactions.

His enterprise has benefitted from authorities efforts to curb the usage of onerous forex — together with the demonetisation of almost all banknotes in circulation 5 years in the past — and from the pandemic.

The platform had 350 million clients on the finish of December, in keeping with the corporate’s regulatory submitting.

But the previous couple of months have seen a dramatic reversal of fortunes for the platform and Sharma has seen his internet value written down by over $1.5 billion since its November 2021 market debut.

Paytm’s father or mother One97 Communications reported a internet lack of 7.79 billion rupees ($102 million) for the December quarter. 

(This story has not been edited by NDTV workers and is auto-generated from a syndicated feed.)

RELATED ARTICLES
- Advertisment -

Most Popular