Leading foreign brokerage Morgan Stanley recently initiated coverage on PayTM with a target price of Rs. 1,875. It believes PayTM is all set to benefit from fast-tracking of digital distribution within the financial services/commerce in India.
Allowance of merchant discount rate (MDR) under UPI, introduction of healthy interchange on wallets and stronger-than-expected execution in financial services are key catalysts for the stock. Its revenues could grow at 40%+ CAGR by FY26 and the company could achieve breakeven at EBITDA level in FY25 (amid rising share of non-payment revenues).
The target price implies upside of 40% from Monday’s closing price.
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