Paytm Q1 Earnings: Brokerages Raise Targets on Execution

Paytm is getting a fresh round of analyst upgrades after its June-quarter numbers, with brokerages pointing to strong revenue and profit growth in a market they see as having a large profit pool. The stock has been a focus for investors tracking the digital payments space, where the company continues to hold a dominant position despite increased competition.

The company's Q1 performance showed solid execution, according to analyst notes. Brokerages have raised their target prices on the stock, betting that Paytm can sustain the momentum. The optimism comes as the company narrows losses and builds out its lending and payments businesses, two areas where it has invested heavily over the past year.

Meesho shares slipped 6% even after the e-commerce firm narrowed its Q1 loss and issued long-term growth guidance of 25% compound annual growth over five years. The market appears to be looking for faster progress on profitability, though the guidance suggests management sees a clear path to scale.

Cipla shares rose 3.7% on Friday despite a 39% decline in first-quarter profit after tax. The stock traded at ₹1,426.40 on the NSE. Investors looked past the earnings drop, focusing instead on the company's pipeline and market position.

Infosys shares fell over 2% after its quarterly results, with brokerages cutting target prices on a lowered growth outlook. The IT services sector has been under pressure as clients tighten spending, and Infosys' commentary did little to reassure the market.

The broader earnings season continues with AU Small Finance Bank, IDFC First Bank, Dr. Reddy's Laboratories, Zen Technologies, SBFC Finance, and Birla Corporation among the companies reporting June-quarter results on July 25. Fractal Analytics posted a 92% jump in net profit to ₹72.3 crore, driven by momentum in healthcare, BFSI, and retail. Mphasis reported 9.9% revenue growth in Q1FY27, calling it its best sequential quarter in three years amid strong AI momentum. Allied Blenders posted flat profit amid supply chain disruptions despite a 5.8% rise in operational income.

Paytm's Alpha Score sits at 57 out of 100, a Moderate label in the Technology sector. The score reflects the company's execution in a competitive market, though the path to sustained profitability remains a key question for investors.

The next catalyst for Paytm will be the pace of loan disbursal growth and any regulatory shifts in digital lending. Brokerages will be watching the September-quarter numbers for signs that the margin improvement is structural, not just a one-time boost.