Paytm share price down 38% since October highs. Should you Buy, Sell or Hold?

livemint.com:

One 97 Communications ) share price declined up to 6.25% during intraday trades on the BSE on Tuesday. Weak investor sentiments are reflected in more than 37% correction in stock prices from October highs.

The major impact to investor confidence was provided by the recent brokerage downgrades following company's decision to cut down on small ticket loans amid regulatory changes. According to analysts, the company's decision to shift focus away from small ticket-size Buy Now, Pay Later (BNPL) loans will have a significant impact on its overall loan originations through the platform, given that this segment constitutes over 50% of total disbursements.

Also read- Cyient stock more than doubled investor wealth in less than a year While Paytm also announced expanding its credit distribution business to enhance focus on higher ticket loans for consumers and merchants in partnership with banks and NBFCs however overall analysts concerns remain elevated on shift in focus from its small ticket size BNPL loans. Analysts at JM Financial commenting on high ticket personal and merchant loans had said that these newer loans will be directed only to well-tested, prime segment customers on the platform.

While we will closely monitor the impact of this strategy of raising ticket sizes meaningfully, near-term growth on lending business and thus financial services revenues is likely to get impacted. At the same time, Paytm Postpaid also serves as a funnel for PL disbursements and this sharp cut could impinge on medium term growth rates on Personal Loans.

Since the resurgence of Paytm stock price since CY22 lows was led by strong uptick in loan distribution business revenues and operational efficiencies thereof. Given the slightly abrupt