On Thursday, Paytm stock was trading at Rs 545.45, down 9.31% from its previous close at Rs 575.25, on the National Stock Exchange (NSE). On Wednesday, the price of a share of stock was Rs 601.45.
The parent company of Paytm, One97 Communications, saw a significant drop in value on Thursday when it was announced that shareholder SoftBank had sold 29.5 million shares of the payments business in a block sale on Thursday.
On Thursday at 10.53 a.m., trading of Paytm shares was spotted taking place at Rs 545.45, representing a loss of 9.31% on the National Stock Exchange (NSE). Wednesday's trading session ended with the share price at Rs 601.45.
The stock of the payments firm fell to a 52-week low of Rs 510.05 on May 12, 2022, and it is presently trading at a level that is very near to that level.
According to reports, SoftBank sold as much as 29.5 million shares in a single block sale on Thursday. This accounted for 4.5% of the firm, which is led by Vijay Shekhar Sharma. As a result, the stock price saw the worst drop since July 29.
Through SVF India Holdings, Softbank has a stake in the financial technology business amounting to 17.45% as of the 30th of September. Following the completion of the transaction, the share will most likely be decreased to 12.9%.
The price range for the trade, which was handled by BofA Securities, was reportedly set between Rs 555 and Rs 601, with the lower end of the price range representing a discount of 7.7% relative to the NSE's closing price on Wednesday, which was Rs 601.45. It is estimated that SoftBank would get Rs 1,628.90 crore, which is equivalent to $200 million, from the sale.
SoftBank sells shares in a block sale, sending Paytm down 10%.
During the first public offering (IPO), the Japanese investor sold shares that were valued around $220–250 million. Previously, the investor had invested $1.6 billion in Paytm. It is important to note that the value of Paytm shares, which was first offered at Rs 2,150, has dropped by 72% since then, significantly reducing the value of SoftBank's stake in the firm.
Anchor investors are those who acquire shares in advance of an initial public offering (IPO), and the time of the sale coincides with the end of the one-year lock-in period for such investors. When the lock-in period comes to an end, the stock of newly-listed businesses tends to become more volatile because institutional investors, who are prohibited from selling their shares during the lock-in period, have a tendency to register profits or losses once the restrictions are no longer in place.
Paytm's initial public offering (IPO), which was met with considerable anticipation and went on to become India's second largest IPO, has also turned out to be one of the biggest disappointments for the investors who purchased shares in the company.
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