Rate, profitability, sales to invested capital ratio could act as key challenges for the company. Paytm is India's leading financial services company that offers full-stack payments & financial solutions to consumers, offline merchants and online platforms.ĭamodaran adds, “Paytm will remain a dominant player in the Indian mobile payment space, as it grows, and that Paytm's management will pivot from growing users to growing revenues and from growing revenues to growing profits, over time, with nothing in their history to back that up."ĭamodaran notes that almost all of the value of Paytm comes from expectations of the future, and there is significant uncertainty in every single dimension. “Access to these smartphones, in conjunction with poor banking outreach in India, has created the perfect storm for a surge in mobile payments in India," he wrote. This also includes the rise of digital payments. The NYU Stern professor claimed that the fintech firm's growth and rise over the years are linked to India’s booming smartphone market, with users going for digital services as access to the internet gets cheaper in the country. He further stated that Paytm will not be a passive (buy and hold) investment, but one that will require active engagement and monitoring of the company's actions and performance. He has priced Paytm’s share at ₹2,190.24. Damodaran, who is also known as the ‘dean of valuation’, has downgraded the Vijay Shekhar Sharma-led company's valuation that Paytm seeks around $30-35 billion with its proposed IPO.
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