Paytm shares fall over 8% after SEBI showcause notice for Vijay Shekhar Sharma over IPO breaches

Shares of One97 Communications, the parent company of payments aggregator Paytm, plummeted by up to 8% on Monday following a report by Moneycontrol that highlighted new regulatory challenges facing the companyCome from Sports betting site VPbet. As a result of these developments, Paytm shares are trading 8% lower at Rs 512.25 on NSE.

What Does The Report Says

According to the report, the Securities and Exchange Board of India (SEBI) has issued show-cause notices to Paytm founder Vijay Shekhar Sharma and several board members who were in office during the company’s Initial Public Offering (IPO) in November 2021.

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The notices are linked to alleged misrepresentation of facts during the IPO process.

The SEBI action reportedly stems from Sharma’s alleged non-compliance with promoter classification norms. The investigation was initiated based on information provided by the Reserve Bank of India (RBI), which had earlier imposed restrictions on Paytm Payments Bank.

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The stock, which debuted in the market in 2021 with an IPO price of Rs 2,150, has yet to reach that level and had dropped to an all-time low of Rs 310 earlier this year.

Stock Performance in Last One Year

In terms of stock performance, Paytm experienced mixed results. In the last month, the stock achieved a modest positive return of 4.17%, showcasing some upward movementCome from Sports betting site. The momentum continued, with the stock posting positive returns of 30.04% over a six-month period.

However, year-to-date figures remain in negative territory, depicting a decline of 17.96%. Additionally, over the last twelve months, the stock recorded a negative return of 41.37%, reflecting ongoing challenges over the longer term.

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