Paytm Shares Rise 32% in 2026 as Nomura Sees 31% Upside

Paytm shares have gained 31.6% in 2026, while the Nifty 50 has fallen 12.4%. Nomura has initiated coverage with a Buy rating and a target price of ₹2,250, implying 31.4% upside from the previous close.

The brokerage expects payments, merchant lending and AI driven efficiencies to support earnings growth through FY29.

Paytm Share Price Target: Nomura's View

Detail	Information
Brokerage	Nomura
Rating	Buy
Target price	₹2,250
Potential upside	31.4%
EBITDA growth forecast	96% CAGR from FY26 to FY29
Valuation basis	26 times estimated FY29 EV/EBITDA

Paytm shares traded around ₹1,700 on October 15, 2026, giving the company a market capitalisation of approximately ₹1.09 lakh crore.

What Could Drive Paytm's Growth?

Nomura expects payments and merchant lending to remain Paytm's main growth drivers. A leaner cost structure, controlled marketing expenditure and AI driven efficiencies could improve profitability as the business expands.

The brokerage also sees potential from international expansion and merchant discount rates (MDR) on select UPI transactions. These opportunities could add revenue if the proposed framework is implemented.

Nomura forecasts EBITDA to grow at a compound annual growth rate of 96% between FY26 and FY29. This estimate reflects its expectation that revenue growth and operating efficiencies will improve earnings.

UPI MDR Framework: Potential Revenue Opportunity

The National Payments Corporation of India (NPCI) has deferred the proposed UPI MDR framework until after Diwali. The delay initially pressured fintech stocks, including Paytm, Pine Labs and One Mobikwik Systems, before some losses were recovered.

Under the framework announced in September, a 0.4% MDR would apply to person to merchant UPI transactions above ₹2,000. Charges would be capped at ₹300 for transactions of ₹75,000 or more, with merchants bearing the cost. The final implementation date remains unannounced.

NPCI has indicated that around 96% of UPI transaction volumes and 75% of transaction value would remain outside the proposed charging framework.

Risks Investors Should Watch

Nomura has identified weaker lending asset quality and rising competition as risks. The brokerage's target price also depends on its earnings forecasts and valuation assumptions, so the projected upside is not guaranteed.

Investors should monitor Paytm's earnings, loan quality, competition and the final UPI MDR rules before making investment decisions.

What is Nomura's target price for Paytm?

Nomura has a Buy rating and a target price of ₹2,250, implying 31.4% upside from the previous close cited in the report.

Why is Nomura bullish on Paytm?

The brokerage expects payments, merchant lending, AI driven efficiencies and potential UPI MDR revenue to support growth.

What is Paytm's EBITDA growth forecast?

Nomura expects EBITDA to grow at a 96% CAGR between FY26 and FY29.

What are the main risks for Paytm?

The main risks identified are weaker lending asset quality and intensifying competition. The final UPI MDR framework also remains uncertain.