The buying in the stock happened after it lost nearly half of its value from its issue price of Rs 2,150 over the past two days, as investors were unconvinced of the company’s rich valuations in the face of weak earnings and business fundamentals.
The buying appeared to have been led by bargain hunters looking to take advantage of any possible mean reversion in the stock, given the sharp drop earlier. However, the conviction behind the buying was far less than the conviction investors displayed when they were dumping the stock. Delivery volume on the stock today was around 22 per cent, which was far less than the delivery volumes seen in the previous two sessions, indicating that speculators were trying to ride the stock for intraday gains.
Whether Paytm will make a good run towards its IPO price remains to be seen. But with doubts of its business model and concerns rising over stricter norms of fintech lending operations, nobody will count on it.
PBoC to the rescue for metal stocks
While Paytm and its other technology brethrens have been dominating the headlines over the past few weeks, metal stocks have silently given up a fair share of their gains this year. China’s slowdown, expensive valuations and a correction in global commodity prices have pricked the bubble in metal stocks on Dalal Street. Before today, the Nifty Metal index had sunk nearly 15 per cent from its record high. Today, the metal index surged 3.3 per cent to end as the top sectoral index on the NSE, as investor confidence improved on the back of signaling by China’s central bank that it may ease policy to steady a sliding economy.
all in on restructuring
Investors of Raymond got a pleasant surprise after The Economic Times reported that the near 100-year-old company was looking to restructure itself to improve growth prospects. The company — with interest in diverse fields like realty, textile and apparels — said it wants to install a professional board and reorganise into five core revenue cores that would, hopefully, boost its growth prospects.
Indian investors love themselves some restructuring as it opens up the doors for more efficiency, value unlocking in subsidiaries and a higher growth focus. Raymond wants it all, and the 17 per cent jump in the stock price suggests so do investors.
