Paytm Share Price Falls Over 1% Despite Q2 FY27 Profit Jump

Paytm shares experienced a decline of more than 1% in early trading on Tuesday, despite the fintech firm announcing robust profit growth for Q2 FY27. One 97 Communications, Paytm's parent company, saw its shares drop 1.3% to ₹1,633 following a modest 1% increase earlier in the day. The stock had previously risen 2.4% on Monday in anticipation of the earnings report.

While Tuesday's decline marked a setback, Paytm shares have still managed to grow by 26.5% year-to-date in 2026, outpacing the Nifty 50, which has fallen by 13% over the same period. The company's market capitalisation is currently valued at around ₹1.05 lakh crore.

For Q2 FY27, Paytm reported a net profit of ₹226 crore, a substantial jump from ₹21 crore in the same quarter last year. Revenue increased by 28.5% year-on-year to ₹2,648 crore, indicating strong business performance. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) climbed by 91.5% to ₹270 crore, with the EBITDA margin improving to 10.2% from 6.8%, signifying enhanced operating profitability.

These results elicited favorable comments from brokerages, who praised the earnings growth and improving margins. However, the stock was unable to maintain its initial gains as the broader market weakened. Paytm anticipates that the proposed merchant discount rate (MDR) on Unified Payments Interface (UPI) transactions will boost its overall payment processing margin by around 2.5 basis points.

The implementation of this measure is expected to take effect after Diwali, with financial benefits stabilising within two to three quarters.

The potential additional revenue stream has bolstered the positive outlook from brokerages, despite short-term share price volatility. Meanwhile, broader market indices traded lower during the morning trading session. Investors will be closely monitoring whether Paytm can sustain its profitability improvements and capitalize on any changes to UPI transaction charges.