Global brokerage firm Citigroup has expressed optimism about Paytm, noting its strong performance in payments, merchant services, lending, and profitability. Citigroup’s recent report, following a conference with Paytm’s management, maintains a Buy rating on the company with a target price of Rs 1,380, indicating significant upside potential. Paytm is benefiting from various growth drivers in India’s digital payments landscape, such as Credit on UPI, online payment gateways, and merchant monetization opportunities.
Citi highlighted Paytm’s robust growth in consumer payments, which outpaced the market growth rate in the fiscal year 2026. With 77 million monthly transacting users, Paytm continues to solidify its position in India’s digital payments sector. The company’s merchant network has also expanded significantly, with around 15 million devices deployed across the country by the end of FY26.
In addition to its domestic growth, Paytm is exploring opportunities for international expansion, particularly in Southeast Asia. The report emphasized the improving monetization trends in Paytm’s payment services, with net payment margins currently at approximately 4 basis points. Even small contributions from high-monetization products like RuPay cards and Credit on UPI can have a substantial impact on overall profitability.
Citi also highlighted the strong potential in Paytm’s merchant lending business, noting that only a small percentage of the merchant base currently utilizes merchant loans, leaving ample room for future growth. Paytm is investing in AI-driven product development in financial services to meet evolving consumer demands. The company’s large merchant network, user engagement, and operational efficiencies are seen as key strengths that could enhance profitability in the years ahead.
