Paytm founder Vijay Shekhar Sharma is no longer a billionaire, with the share price of one of India’s most storied startups dropping more than 70 percent from its issue price of Rs 2,150 in the past four months, Forbes data on March 16 shows.
The precipitous drop highlights the turbulence the Noida-heaquartered firm has been facing. Just last week, the Reserve Bank of India (RBI) barred Paytm Payments Bank from onboarding new customers.
According to Forbes, Sharma's wealth stands at $999 million from its peak of $2.35 billion before the IPO listing. One97 Communications Ltd , the parent company of Paytm, listed on November 18, 2021. Since that day, Sharma has been losing around Rs 88 crore daily.
The firm raised Rs 18,300 crore through the initial public offering. On November 18, it was valued at Rs 1.39 trillion, ranking among the top 50 most valued companies in India.
But ever since, it has been downhill all the way. The company has lost around Rs 1 trillion in market cap, now down to Rs 4,0000 crore. The firm now ranks 112th on the list of most valued companies.
According to a company spokesperson, as of December quarter, Sharma’s stake in One97 Communications was at 8.9 percent, or around 57.67 million shares.
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About 30.97 million shares held by Axis Trustee Services Ltd (4.8 percent of post-IPO basic share count) are also trust shares held on behalf of Sharma. His stake is valued at Rs 5,558 crore.
The RBI ban on Paytm Payments Bank from adding new customers pushed the share price even lower. The bank has also been directed to appoint an IT audit firm to conduct a comprehensive system check of its information technology system.
Also Read | Vijay Shekhar Sharma denies report of Paytm Payments Bank leaking data to Chinese firms
The ban may not have a substantial impact on the listed fintech's business but recent developments substantially reduce Paytm’s chances of upgrading to a small finance bank licence, brokerage firm Macquarie has said in a report.
The company is due to apply for the licence in May after the Payments Bank completes five years.
A Bloomberg report suggested that the RBI barred Paytm after it allowed data to be leaked to Chinese firms, a claim denied by Sharma. The Bloomberg report also said the regulator raised questions over the failure of verifying the customers through KYC norms.
At 11.30 am, the stock was trading at Rs 630, up 6.3 percent from the previous day on BSE.