Optimism Grows for Paytm as AI Innovation Boosts Profitability

Leading brokerage firms such as Bernstein, Jefferies, JM Financial, Mirae Asset Capital Markets, Emkay Global, and YES Securities have expressed renewed optimism for One 97 Communications Ltd, popularly known as Paytm, after evaluating its second-quarter results for FY26. These updates underscore Paytm's unyielding profitability, expansion in financial services, and a strong focus on AI-driven innovation as pivotal factors for sustained growth and increased investor confidence.

The detailed market assessments highlighted Paytm's impressive operational performance, meticulous cost management, and an increasing contribution from AI-initiated products as essential components fostering its profitability and scalability. Bernstein notably elevated its target price to Rs 1,600, maintaining an 'Outperform' rating, citing significant margin improvements and robust gross merchandise value (GMV) growth facilitated by effective cost measures and a surge in financial services revenue.

Additional insights indicated that substantial investments in front-line sales to capture a broad spectrum of online and offline merchants accentuate the long-term potential of Paytm’s payment processing margins. Several firms, including JM Financial and Dolat Capital, also reaffirmed their 'Buy' ratings, raising target prices while applauding the company’s track record of outperforming profit expectations and emphasizing the transformative role of AI in driving revenue increases and operational efficiency. The overall consensus among analysts indicates a promising growth trajectory for Paytm, fueled by solid fundamentals and expansion efforts.