Paytm shares made a weak debut in the secondary market on Thursday with the stock listing at a discount of over 9 percent from the issue price of Rs 2,150.
Though the Paytm listing did not receive as great a response as several other firms have recently, President and Group CFO of Paytm Madhur Deora called lending a fantastic opportunity for the company.
“You would have seen in our prospectus that we disclosed we did 2.8 million loans in the September quarter alone. In all of last year, we did 3 million loans. So, it is a fantastic opportunity, it is growing very, very fast and it is also very, very early for us. We literally started doing this maybe five quarters ago so it is a huge opportunity for us,” he told CNBC-TV18.
Meanwhile, Vijay Shekhar Sharma, MD and CEO of Paytm said, he is of the opinion that people will take time to understand the firm’s business model. The fact that a payment company can do financial services like private insurance and wealth is something new to the Indian stock market or public shareholders are large, he said.
“Over the period it will show-up that what this business model impact and scale is. So today’s share prices or any day’s share price will actually never be a true reflection of our opportunity and our scale. It is simply an opinion of few buyers and sellers of that day.”
His remarks came as the shares of One97 Communications Ltd, Paytm's parent company, were listed at Rs 1,955 on the Bombay Stock Exchange (BSE). The stock then further tumbled 20.67 percent to Rs 1,705.55.
Earlier in the day, the Paytm stock dipped to as low as Rs 1,586 on both the bourses, a discount of 26 percent to the issue price of Rs 2,150. At the intraday high, a share was quoted at Rs 1,961.1 on BSE and Rs 1,955 on NSE – still a discount of almost nine percent.
Sharma, however, said he is very sure that the listing is a phenomenal opportunity to build a payment company and the stock market in due course will learn at large and a large number of people will understand the business model.
“Remember, when we launched Paytm as payment method, like you open a phone, pick up your phone and make a payment that was not understood by people. People took time to understand what it is so exactly the same way. The business model is an obligation for us to make learn to people and people will learn it,” he explained.
For the full interview, watch the accompanying video...