Paytm shares declined over 1 percent in morning trade on Tuesday, reversing early gains even as brokerages maintained a bullish outlook following the fintech company's second-quarter results. Strong profit growth, improving operating margins and expectations of additional earnings from the proposed UPI merchant discount rate (MDR) supported positive brokerage recommendations.
Shares of One 97 Communications, which operates Paytm, fell 1.3 percent to Rs 1,633, after rising about 1 percent in early trade. The stock had gained 2.4 percent on Monday, ahead of the earnings announcement. Paytm shares have risen 26.5 percent so far in 2026, outperforming the Nifty 50, which has declined 13 percent over the same period. The company's market capitalisation stood at approximately Rs 1.05 lakh crore.
The decline came amid a subdued broader market. At 9:30 am, the Sensex was down 134.74 points, or 0.18 percent, at 73,472.01, while the Nifty slipped 17.55 points, or 0.08 percent, to 22,735.65.
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Bernstein maintained its Outperform rating with a target price of Rs 2,200, implying approximately 33 percent upside from Monday's closing price. The brokerage highlighted strong financial services revenue growth, improving payment margins and sustained operating momentum.