Global brokerage Citi maintained its ‘Buy’ rating on Paytm with a target price of Rs 1,500 following the company’s earnings announcement.
Paytm Q2 Results
Paytm reported a steep 98% year-on-year decline in its consolidated net profit for Q2FY26, posting Rs 21 crore compared to Rs 928 crore in the year-ago period. The profit drop was driven by a one-time impairment charge of Rs 190 crore related to its joint venture, First Games Technology. Excluding this, profit after tax (PAT) stood at Rs 211 crore.
Despite the decline in profit, operating performance remained strong.
Revenue from operations rose 24% YoY to Rs 2,061 crore, supported by higher subscription merchants, increased payments GMV, and growth in financial services distribution.
Contribution profit grew 35% YoY to Rs 1,207 crore, with contribution margin improving 5 percentage points to 59%, aided by higher net payment revenue and lower DLG expenses.Net payment revenue increased 28% YoY to Rs 594 crore, while financial services distribution revenue surged 63% YoY to Rs 611 crore, led by merchant loan distribution.The company said it has continued to gain consumer market share, supported by product improvements and integration of AI features. It outlined four core focus areas: strengthening merchant leadership (online and offline), expanding full-stack offerings (payment gateway, QR, Soundbox, and All-in-One POS), and scaling credit and financial services.
Citi Maintains Rs 1,500 Target
Citi reiterated its ‘Buy’ rating with a target price of Rs 1,500, citing strong growth momentum in UPI credit (including RuPay and Postpaid), which drove a 4+ basis point improvement in net payment margins in Q2. The brokerage raised margin estimates for FY26–28 to around 4.2 basis points and highlighted improved unit economics due to lower device costs.
Citi also upgraded EBITDA forecasts for FY26/27/28 by 33%, 19%, and 13%, respectively. It noted that Paytm beat expectations on Q2 EBITDA (Rs 180 crore) and EBIT (Rs 40 crore), supported by lower D&A expenses. The brokerage pointed to robust growth prospects across payment aggregation, UPI credit, and equity broking.
MSCI Inclusion
As part of the November 2025 semi-annual review, MSCI announced a reshuffle of its India indices. Among the key changes is the inclusion of FSN E-Commerce Ventures (Nykaa) and One 97 Communications (Paytm) in the MSCI India Standard Index, reflecting evolving market-cap dynamics.
Effective after market close on November 24, MSCI has added six stocks to the India Domestic Index and removed three. New additions to the Standard Index include:
– Fortis Healthcare
– FSN E-Commerce Ventures (Nykaa)
– GE Vernova T&D India
– Indian Bank
– One 97 Communications (Paytm)
– Siemens Energy India
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