2 weeks ago
Brokerages raise Paytm targets on UPI MDR optimism
Paytm is a company that lets people pay for things using their phones.
Some grown-ups who study companies, called brokers, think Paytm will earn more money soon.
The government made a new rule that could let Paytm charge a small fee on some UPI payments.
UPI is a way people send money to each other very quickly using their phones.
Because of this possible new money, three big finance firms raised their price guesses for Paytm's shares.
Bernstein thinks Paytm's shares could be worth Rs 2,200, BofA says Rs 1,775, and JM Financial says Rs 1,950.
Paytm's shares have already become more expensive in the last week and month.
Paytm also made a lot more profit recently, with net profit going up 79%.
But the experts warn the fee might be smaller than expected, or competition could get stronger.
So there is a chance the shares won't climb as high as the brokers hope.
Bernstein raised its Paytm target price to Rs 2,200, above Paytm's IPO price of Rs 2,150.
BofA Securities retained a 'Buy' rating, raising its target to Rs 1,775 from Rs 1,560.
Paytm shares jumped nearly 15% in the past week, 20% in the past month and about 50% in the past six months.
Paytm's June 2026 quarter net profit rose 79% YoY to Rs 220 crore, with revenue up 28% YoY to Rs 2,448 crore.
JM Financial reiterated 'Buy' with a target of Rs 1,950, estimating Rs 200 crore and Rs 440 crore incremental revenue from MDR in FY27 and FY28 respectively.
- Who
- Paytm and brokerages Bernstein, BofA Securities and JM Financial
- What
- Brokerages raised their price targets on Paytm shares after MDR on select UPI transactions opened a new earnings stream and strong quarterly results supported the stock
- Where
- Not specified in the article
- When
- Following Paytm's June 2026 quarter results, with the stock rallying over the past week, month and six months
- Why
- The enabling amendment through Parliament opened the path for MDR to apply on UPI transactions beyond a defined threshold, creating a new revenue stream for Paytm
Bullish on MDR earnings upside
Cautious on priced-in gains and risks
Impact of MDR on UPI transactions
Bullish on MDR earnings upside
MDR opens an earnings stream Paytm did not have before; JM Financial estimates Rs 200 crore (FY27) and Rs 440 crore (FY28) incremental revenue, and BofA sees 18-24% upside risk to FY28-30 EPS.
Cautious on priced-in gains and risks
The stock has already outperformed on MDR news and much of the benefit may be priced in; higher competition, a lower-than-expected MDR, a high turnover threshold and rollout slipping beyond H2FY27 could limit the upside.
Key facts
- Bernstein target price
- Rs 2,200 (above IPO price of Rs 2,150)
- BofA Securities target price
- Rs 1,775 (raised from Rs 1,560)
- JM Financial target price
- Rs 1,950
- 52-week low
- Rs 947.10 hit on March 30
- Stock gain from 52-week low
- Up to 75%
- June 2026 quarter net profit
- Rs 220 crore, up 79% YoY
- June 2026 quarter revenue
- Rs 2,448 crore, up 28% YoY
- June 2026 quarter EBITDA
- Rs 203 crore, up 54% YoY, margin 8.3%
Quotes
JM Financial Ltd
Investment research firm analyst
“Key risks to this thesis include the eventual rate settling below the 25bps assumption, a turnover threshold calibrated high enough to meaningfully narrow the eligible base, and rollout slipping beyond H2FY27.”
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