Shares of One97 Communications, the parent of Paytm, on Monday hit a new low after brokerage Macquarie slashed its target price 25 per cent to Rs 900 per share.

On the BSE, the scrip settled with losses of 6 per cent or Rs 74 at Rs 1,157.90 after hitting a day’s low of Rs 1,151 — a fall of almost 6.56 per cent. At close, Paytm had a market cap of around Rs 76,000 crore.

“Post the various business updates and results, we believe our revenue projections, particularly on the distribution side, is at risk and hence we pare down our revenue CAGR from 26 per cent to 23 per cent for FY21-26E (estimated),” Macquarie said.

“We are roughly cutting revenue estimates for FY21-26E on an average by 10 per cent every year due to lower distribution and commerce/cloud revenues offset partially by higher payment revenues,’’ the brokerage said in a note.

It said the payment business still account for 70 per cent of its gross revenues and any regulation capping charges could impact earnings significantly.

Macquarie said Paytm’s foray into insurance was recently rejected by regulator IRDAI.

However, post market hours, Paytm came out with a strong update on the operating performance for the third quarter ended December 31, 2021.

Paytm said the number of loans disbursed through its platform increased 401 per cent over the same period of the previous year to 44 lakh compared with 8.81 lakh loans disbursed in the October-December 2020 period.

In value terms, this stood at Rs 2180 crore against Rs 470 crore in the same period of the previous fiscal.“We cut our earnings (increase our loss projections) by 16-27 per cent for FY22-25E owing to lower revenues and higher employee and software expenses. We cut our target price sharply by 25 per cent owing to lower target multiple of 11.5x (Price to Sales ratio) (from 13.5x earlier) and lower sales numbers," it observed.