Citi report sets Rs 1,000 target for Paytm

Delhi Delhi: A Citi Research report has highlighted Paytm’s strong position in India’s digital payments ecosystem despite changes in UPI subsidy policies.

While the government has reduced the UPI incentive allocation to Rs 15 billion for FY25, Citi suggests that the move could pave the way for the introduction of merchant discount rates (MDR) on big-ticket transactions, a development that could work in favour of fintech players like Paytm.

The report shows that Paytm has maintained a stable market share of 5.3 per cent in UPI transactions, reflecting its resilience in a highly competitive industry.

The overall growth of UPI merchant payments remains strong, recording a 23 per cent year-on-year growth in February 2025. Citi’s findings show that Paytm’s extensive merchant network and its diverse suite of financial services allow it to remain a key player in India’s digital payments revolution.

Analysts at Citi have set a target price of Rs 1,000 per share for Paytm, indicating a potential upside of 31.1 percent.

The report highlights that the company’s strategic cost management and expansion into financial services could contribute to long-term profitability.

With the continued growth of digital payments in India, Paytm’s ability to adapt to regulatory changes and explore new revenue sources makes it one of the strongest contenders in the fintech sector.

Regardless of policy adjustments, Citi Research sees Paytm as a promising investment opportunity. Its well-established user base, strong technology infrastructure, and growing financial services segment create a strong foundation for future growth.

As the government is considering potential MDR implementation on large transactions, Paytm could benefit significantly in the coming years.

Shares of One 97 Communications Ltd fell by nearly 6 per cent during today’s trading session to close at Rs 733.15, down 29.95 points or 3.92 per cent.