Haitong International Bullish on Paytm's Growth Potential

Haitong International predicts Paytm could fund its expansion internally, supported by strong treasury and improving financial metrics, possibly reducing the need for external funding. The brokerage expects robust revenue and profit growth, driven by efficiency and AI application, while maintaining an 'Outperform' rating with a target price of ₹1,980.

Haitong International is optimistic about Paytm's ability to fund its future expansion through internal resources, bolstered by a strong treasury portfolio, improving operational performance, and increasing profitability. This could potentially diminish the need for external capital. The latest report on One97 Communications from Haitong highlights Paytm's resilience against regulatory challenges, crediting the management's strategic responses. Haitong maintains its 'Outperform' rating with a target price of ₹1,980.

The brokerage highlights Paytm's substantial treasury portfolio, valued at approximately ₹135 billion as of March 2026, and solid operating metrics, which, coupled with improving EBITDA margins, should suffice for future growth initiatives. Haitong projects a 30% compound annual growth rate in revenue for Paytm from FY26 to FY28, with EBITDA and profit after tax expected to increase nearly five-fold within that timeframe.

Furthermore, Haitong anticipates continued AI utilization to bolster expedited revenue growth and operational leverage, further enhancing EBITDA margins. Paytm's core EBITDA margin is projected to reach about 19% by FY28. The report points to heightened operational efficiency, evidenced by a 16% year-on-year reduction in employee expenses to around ₹26 billion in FY26, concurrent with adding approximately 9,400 sales employees. Haitong foresees Paytm remaining asset-light and partnership-focused in lending distribution while boosting emphasis on wealth services, such as equity broking and mutual fund distribution, contributing significantly to revenue and profitability. (ANI)