BofA Forecasts Continued Margin Expansion for Paytm in Q2

With revenue projected to hit Rs 2,641 crore, Bank of America anticipates a robust second quarter for Paytm, driven by aggressive expansion in payments and financial services. The brokerage firm maintains a Buy rating, citing consistent growth and improved margins as key indicators of the company’s strengthening financial health.

Editorial·October 6, 2026·reads: 1,577

BofA Forecasts Continued Margin Expansion for Paytm in Q2

The firm projects a 28 percent year-on-year revenue increase, supported by a 31 percent jump in payments revenue and a 44 percent rise in financial services. Net income is expected to reach Rs 271 crore, representing a 23 percent sequential gain. Analysts at BofA highlight that EBITDA margins are likely to climb to 10 percent, bolstered by a disciplined reduction in fixed costs and an 82 percent compound annual growth rate projected through fiscal year 2029.

Operational momentum appears broad-based, with gross merchandise value growing 8 percent sequentially alongside the addition of 0.5 million Soundbox units. Merchant lending remains a primary engine, though consumer lending is also scaling from its initial base. Furthermore, the company stands to benefit from the 40 basis point merchant discount rate effective October 15, which, combined with a dominant UPI market share, positions Paytm to sustain its current upward trajectory.