Paytm, once one of the most hyped tech IPOs in India, has had a rough ride in 2025. Its shares have dropped nearly 18% since the start of the year, sinking from ₹987.60 to ₹810 apiece. But here’s the twist, instead of running away, Indian mutual funds are buying more of it.
During the January–March quarter of FY25 (Q4), domestic mutual funds raised their stake in Paytm’s parent company, One97 Communications Ltd., from 11.2% to 13.1%. This increase might seem surprising, especially with the stock still trading at less than half of its IPO price of ₹2,150.
Among the most aggressive buyers were Nippon India Mutual Fund and Motilal Oswal Mutual Fund. Nippon India now owns 2.8% of Paytm’s stock (up by 0.4%), while Motilal Oswal raised its stake to 2.3% (an increase of 0.2%).
In total, institutional ownership in Paytm, which includes both domestic and foreign investors — rose by around 1% to reach 69% in Q4. Interestingly, while domestic funds were loading up, foreign investors slightly trimmed their holdings, going from 119 million shares to 115 million.
So, what’s behind this renewed confidence?
Paytm has been working hard to reposition itself, focusing more on profitability and partnerships. The company recently teamed up with RBL Bank to offer card machines and soundboxes to merchants, rolled out new UPI-based trading tools for retail users, and began using artificial intelligence to enhance the user experience.
Even though its stock has taken a beating, these strategic moves could be laying the groundwork for a stronger comeback — and mutual funds seem to agree.
Whether this marks the beginning of a turnaround remains to be seen. But if there’s one thing clear, it’s that smart money isn’t backing away from Paytm just yet.
Disclaimer: This article is for informational purposes only. Investors should do their own research or consult financial advisors before making any decisions.
