Paytm shares declined over 2% on Monday, October 26, ahead of the company's second-quarter results announcement for FY27. On the National Stock Exchange, Paytm shares touched an intraday low of ₹1,583.20, down ₹32.90 or 2.04% from the previous closing price of ₹1,616.10. The stock movement reflects investor caution ahead of the earnings announcement, with market participants closely watching for signs of sustained growth in payments, stronger merchant monetisation and further improvement in profitability.
Bank of America (BofA) expects Paytm to generate ₹2,641 crore in revenue for the July-September quarter, representing a 28% increase from the year-earlier period and an 8% rise over Q1 FY27 when the company recorded revenue of ₹2,448 crore. As reported by Goodreturns, the profit forecast is more upbeat with the brokerage estimating net income of ₹271 crore, which would be 76% higher year-on-year and 23% above the ₹220 crore reported in the June quarter. For operating earnings, BofA has projected EBITDA of ₹263 crore, an increase of 86% from a year earlier, with the EBITDA margin expected to reach 10%, improving by 166 basis points sequentially.
According to Goodreturns reports, the payments division is expected to remain a major contributor to the quarter's performance. BofA forecasts a 31% year-on-year increase in payments revenue and an 8% sequential rise in gross merchandise value (GMV), which measures the total value of transactions processed through the platform. The brokerage also expects Paytm to add approximately five lakh Soundbox devices during the quarter, which provide merchants with audio confirmations of incoming payments and help the company maintain its presence among small businesses and offline retailers.
As reported by Goodreturns, BofA expects revenue from financial services to increase 44% year-on-year in Q2 FY27. Merchant lending is projected to contribute significantly, while consumer lending is also showing signs of expansion from a smaller base. Paytm distributes credit products through partnerships with regulated financial institutions, allowing it to earn income from facilitating loan distribution without directly carrying the associated loans on its own balance sheet.
According to Goodreturns, BofA has forecast a 7% quarter-on-quarter recovery in Paytm's commerce and cloud services business. Improvement in this segment could provide an additional contribution to revenue and reduce reliance on payments and financial services alone. The quarterly results should provide a clearer indication of whether this network is supporting further monetisation, with BofA identifying market-share gains in UPI and improved merchant monetisation as potential sources of upside.
