Paytm stock price hits upper circuit, is it a good time to buy? What market experts say

Paytm stock price may be rising but some brokerage firms have downgraded the stock after RBI's action.

Paytm Share Price: Paytm shares gained 5 per cent as the stock hit the upper circuit for the second straight session. This comes as the company partnered with Axis Bank for the settlement of merchant payments- shifting its nodal account through an escrow account. This also comes as the Reserve Bank of India (RBI) extended the deadline to halt operations for Paytm Payments Bank account holders till March 15.

Paytm Stock Price: A QR code for the Paytm digital payment system at a roadside coconut stall in Mumbai, India. (Bloomberg)

What brokerage firms have said on the stock?

Some brokerage firms have downgraded the Paytm stock after RBI action. Global brokerage firm Macquarie in its recent report downgraded the stock's rating to ‘underperform’ significantly lowering its target price to ₹275 per share from an earlier target price of ₹650.

What analysts have said on the Paytm stock?

Jigar S. Patel, senior manager of Equity Research at Anand Rathi Share and Stock Brokers told Mint, “Should there be any potential upward movement from lower levels, it may serve as an opportunity to exit positions. The daily Stochastics indicator has entered the oversold zone, suggesting a continuation of bearish momentum. Consequently, traders are advised to stay away from this counter.”

Although, Milan Vaishnav, CMT, MSTA, Founder and Technical Analyst of Gemstone Equity Research and ChartWizard FZE said that investors should strictly avoid the stock as “given the kind of turmoil the company is in, it would be prudent not to add any more quantity even if it is available at a deep discount. While staying put with the investments and taking a steep cut would make no sense for the investors, any fresh or incremental exposure in the stock should be strictly avoided.”