Retail investors amped up Paytm holdings in Q3 before curbs crashed the stock

Small investors have been hit hard by the plunge in shares of One 97 Communications (Paytm), since the Reserve Bank of India (RBI) issued curbs on associate Paytm Payments Bank over repeated non-compliance with regulations.

- Ram Sahgal

The retail investor category sharply hiked its stake in Paytm to 12.85% during the December quarter (Q3FY24) from 8.28% in the September quarter (Q2FY24). Market experts believe that in the absence of clarity on the fate of the payment bank's operations, the near-term outlook for the company remains bleak.

Many new retail investors hopped on to the counter in the hope of generating high returns. This is borne out by the number of retail investors holding up to 2 lakh each of the firm's equity capital jumping to 1.1 million in Q3 from 990,819 in the preceding quarter.

A year ago, in December 2022, small investors' holding was lower at 9.24%. The recent fall in share price would thus have come as a rude shock to the new and existing investors.