Paytm’s Fall Is A Case Of ‘Fantasy Multiples’ Meeting Market Reality: SEBI RA Nikhil Gangil

Paytm’s stock remains a valuation case study, citing the company's sharp post-IPO decline as an example of why “the price you pay always matters,” according to SEBI-registered analyst Nikhil Gangil.

At the time of writing, Paytm shares were trading at ₹898.65, down 6.43% on the day.

Gangil said the 2022 tech IPO boom brought a wave of companies with “little to no profits” to market at inflated valuations. 

Paytm was valued at over ₹1.3 lakh crore, trading at a price-to-book of 10.6 and price-to-sales of 22 at the time of listing. 

“Revenue didn’t justify valuation,” he said.

Gangil flagged concerns over Paytm’s monetisation strategy, calling it “high-volume but low-margin,” while its lending business remained nascent or tightly regulated. 

He said the company was compared to global peers like Alibaba and Square — analogies he described as misleading given Paytm’s different fundamentals.

“Fantasy multiples” and a lack of profitability set the stock up for a fall, Gangil said, pointing out that the company’s growth began to stall shortly after listing. 

Payment volumes plateaued, regulatory headwinds hit the lending arm, and the focus shifted to contribution margins — a red flag, he argued, that core profitability remained weak.

The result was a drop of over 70% in the stock price. 

“A sky-high valuation sets the bar unrealistically high. Missing that bar destroys trust,” Gangil said.

He added that markets eventually price in fundamentals, not narratives, and warned against FOMO-driven investing. 

“Narratives work until numbers arrive,” he said.

Gangil also noted that many 2022-era tech disruptors now face disruption themselves. 

“In the age of AI agents and autonomous tools, the fintech platforms that once felt revolutionary are beginning to look dated,” he said, adding that tech valuations must reflect durability rather than novelty.

Despite his criticism, Gangil said he hopes Paytm turns around operationally. 

“A thriving, well-managed Paytm would be a win for investors and for India’s startup ecosystem,” he wrote, adding, “valuation teaches discipline, and discipline protects wealth.”

On Stocktwits, retail sentiment was ‘neutral’ amid ‘high’ message volume.

The stock has declined 9% so far in 2025.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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