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Paytm Share Price: Heavy buying on buyback plan, Paytm shares jumped 7%

Paytm Share Price: Today, on December 9, the shares of Paytm's parent company One 97 Communications are being bought heavily. The company had informed the stock exchanges a day earlier that it may take a decision on share buyback in the board meeting to be held on December 13. After this information came to the fore, the shares jumped today and reached Rs 542.90 on the BSE with an intra-day jump of 7 per cent. According to the information given in the regulatory filing, the management believes that considering the current liquidity and financial position of the company, the buyback can prove to be beneficial for the shareholders.

What is share buyback?

Share buyback or repurchase of shares is a process through which a company buys back its own shares from investors and shareholders. Usually the company buys these shares at a higher price than the current market price. It is considered an alternative and less tax-efficient model of returning money to its shareholders.

Shares are still at 75% discount from IPO Price

Paytm shares were issued to IPO investors at a price of Rs 2150. Its issue of Rs 18300 crore came in November last year and till now it has not proved to be beneficial for IPO investors. This year, on 24 November 2022, it had slipped to a record low of Rs 439.60 on BSE, which means the capital of IPO investors had fallen by about 80 per cent. Right now the price is showing about 21 percent recovery but it is still at 75 percent discount from the IPO price. Its shares are currently trading at Rs 530.70 (Paytm Share Price).

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