Brokers call: Paytm (Reduce)

As part of its strategy of focusing on the dwindling core business viz. Payments and Financial Services post RBI action, One97 Communications owners of Paytm is exploring a deal with Zomato (foodtech) to transfer its high-margin (take rate: 5-8 per cent) movies and event ticketing business (a subset of Marketing Services); this is likely to hit Paytm s customer traffic. Similarly, Paytm has shelved plans to manufacture General Insurance products, and instead focus on distribution.