Paytm shares have significantly outperformed the broader Indian stock market so far in 2026, but brokerage firm Nomura believes the fintech company has considerably more room to grow. Initiating coverage on One 97 Communications, the parent company of Paytm, Nomura has assigned a 'Buy' rating with a target price of Rs 2,250 per share, implying an upside potential of 31.4 percent from Wednesday's closing price.
The brokerage expects strong growth in Paytm's core payments and merchant lending businesses, supported by a leaner cost structure and operating efficiencies driven by artificial intelligence (AI). Nomura also sees additional growth opportunities from the proposed introduction of merchant discount rates (MDR) on select UPI transactions and international expansion.
Paytm shares were trading 0.7 percent lower at around Rs 1,700 in Thursday's morning session, giving the company a market capitalisation of approximately Rs 1.09 lakh crore. Despite Thursday's decline, the stock has gained 31.6 percent so far in 2026, sharply outperforming the Nifty 50, which has fallen 12.4 percent over the same period.
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Nomura expects Paytm's earnings before interest, tax, depreciation and amortisation (EBITDA) to grow at a compound annual growth rate (CAGR) of 96 percent between FY26 and FY29, reflecting its expectations of substantial operating leverage as the business scales.