Alibaba sells 3.1% stake in Paytm

NEW DELHI: Chinese conglomerate Alibaba is learnt to have sold a 3.1% stake - nearly half of its direct shareholding - in digital financial services firm One97 Communications in an indication of exiting the Indian market, sources said.

However, Alibaba group firm Ant Financial has not diluted its stake in Paytm and continues to hold 25% of the company.

“There was a big movement in Paytm’s stock today as a block deal took place where 2,59,930 shares were sold at Rs 535.90 worth 13.93 crore rupees. Chinese group Alibaba is behind the deal, selling up to 3.1 per cent of its total equity of about 6 per cent”, a source closely watching the development at Paytm said.

The development follows Alibaba’s stake sale in BigBasket and Zomato. Alibaba seems to be making an exit from India as it has sold shares in other investments,” the source said.

The company’s shares closed at Rs 542.25 apiece on the BSE.

Paytm’s shares have been gaining after its associate Paytm Payments Bank received the RBI approval to appoint Surinder Chawla as its MD-CEO.

Email queries sent to Alibaba and One97 Communications did not elicit any immediate reply.

Meanwhile, Morgan Stanley has said Paytm would emerge as a key beneficiary following the Union Cabinet approving the incentive scheme of Rs 26 billion for promotion of RuPay Debit Cards and low-value BHIM-UPI transactions (P2M) for FY23, compared with Rs 15 billion in FY22. “On our estimates, Paytm would have received 5-7 per cent of the FY22 incentive, and assuming a similar share for FY23, this would represent 3-5 per cent of our contribution profit estimate (1 per cent higher than what we previously assumed for FY23),” the brokerage firm mentioned.