Jefferies calls Paytm its 'preferred pick' in fintech, raises target price to ₹1,600 amidst 'healthy core growth'
Nov 13, 2025
New Delhi [India], November 13 : Global brokerage firm Jefferies has reaffirmed its bullish stance on One 97 Communications Ltd (Paytm), maintaining its BUY rating while raising the target price to ₹1,600 from ₹1,420.
The firm said it was encouraged by "healthy core growth" and "rising option value across wealth, lending and international segments," adding that Paytm remains its "preferred pick among fintechs."
Jefferies added that Paytm is "at an inflection point to scale-up new segments that will leverage its distribution and customer base." It pointed to emerging opportunities in wealth products such as digital gold, mutual funds, margin trading facility, equity broking, lending products like postpaid, and early-stage international expansion, adding that these segments "will aid strong growth in the medium term with improving margin profile."
The brokerage firm noted that Paytm reported a healthy 24% year-on-year rise in revenues in the September quarter, aided by improved net take rates in the payments business and stronger growth in financial services. It noted that "growth in core business and ramp-up in new areas can aid 24% CAGR in revenues and expansion in EBITDA margin over FY25-28."
It said Paytm's adjusted EBITDA came in at ₹1.8 billion, above estimates, and praised the company's disciplined execution.
The report projects 24% revenue CAGR over FY25-28, with adjusted EBITDA margin improving from -10% to +18% by FY28, and GMV expected to rise 24% annually with contribution margins sustaining around 58-59%. It forecasts PAT to touch ₹20 billion by FY28, underscoring what it calls "healthy growth in core revenues and profits."
Jefferies noted that the stronger momentum in earnings will support premium valuations and compounding. "Since our upgrade of rating in July 2025, the stock has risen by 20%+ and valuations do price its stronger franchise. We still feel that stronger momentum in earnings will support premium valuations and compounding," it said.
It further noted that catalysts such as broad-basing of lenders (more lenders lending on Paytm), stabilisation of payment margins, and better asset quality will drive future growth.
Jefferies concluded that Paytm's continued operating leverage, expanding profitability, and scaling of new business lines make it a "preferred pick among fintechs."
