The Bombay Stock Exchange on Wednesday sought clarification from One 97 Communications Limited. The parent of payments solution company Paytm, over the steep fall in the company’s share price.
The exchange said it has sought clarification from “One 97 Communications Ltd on 22 March 2022 with reference to the significant movement in price, It is to ensure that investors have the latest relevant information about the company. Also to inform the market so that the interest of the investors is safeguarded”. The reply is awaited, it said.
In a statement to the exchanges on March 23, One One 97 Communications clarified the BSE’s query. It read:
“We would like to inform you that our Company has been complying with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations) and have, from time to time, made all necessary disclosures to the Stock Exchanges within stipulated timeline.
Further, as on date, there is no information/ announcement, which in our opinion may have a bearing on the price/ volume behaviour in the scrip of the Company. It is yet not disclosed to the Stock Exchanges.”
This notification came after shares of One97 Communications tanked 4 per cent to hit an all-time low of Rs 541.15 on the BSE. The market cap of the firm fell to Rs 35,915.27 crore. The shares ended the day 3.79 per cent lower at Rs 543.90.
Shares of One97 have been on a downward trend for a while, with the stock dipping nearly 72 per cent from an all-time high of Rs 1,961. It had touched on the day of its market debut.
, in response to a query from the Bombay Stock Exchange, said its business fundamentals remain robust, and it has “no information” that may have any bearing on its stock’s price-volume behavior.
It added no information could potentially impact the share price that it hasn’t already disclosed to regulators.
At an issue price of Rs 2,150, it had asked for a market capitalization of Rs 1,39,432.7 crore. It has plunged to Rs 35,273.23 crore now. The stock has witnessed a market cap erosion of Rs 1.04 lakh crore in four months.
Macquarie Capital Securities had, last week, slashed the target price of One97 Communications to Rs 450. It is down by 36 percent as compared to Rs 700 it had predicted in February.
The brokerage firm sharply marked down its valuation estimate for Paytm in line with the derating since in global financial technology companies.
On 11 March, the Reserve Bank of India (RBI) directed unit Paytm Payments Bank Ltd (PPBL) to halt the onboarding of new customers after noticing certain material supervisory concerns.
The central bank asked PPBL to appoint an IT audit firm to conduct a comprehensive system audit. No new customers can join PPBL without specific permission granted by RBI after reviewing the IT auditors’ reports.
“The bank is taking immediate steps to comply with RBI directions. It includes the appointment of a reputed external auditor to conduct a comprehensive system audit of its IT systems,” One97 said in a statement following the RBI action.