Foreign Investors Reduce Stake In Paytm To 49.4% In March Quarter

Foreign institutional investors (FII) decreased their stake in listed fintech major Paytm to 49.4% during the March quarter (Q4 FY26) from 51.76% in the previous quarter (Q3 FY26). 

Category I foreign portfolio investors (FPI), which include government-related entities like sovereign wealth funds and central banks, pension funds, among others, reduced their holding in the Vijay Shekhar Sharma-led company to 23.77% in Q4 from 25.33% in the previous quarter. The number of Category 1 FPIs also fell to 558 from 613 in Q3. 

Category II FPIs, which include mutual funds, banks and insurers, cut their holding to 0.48% from 1.24% during the quarter as 19 shareholders from this category quit Paytm’s cap table. 

Meanwhile, foreign direct investments (FDI) saw a marginal 15 basis point QoQ drop to 25.18% in the March quarter. 

The decline in FII holding came amid broader foreign investor outflows from the Indian equities market. FPIs sold Indian equities worth ₹1.17 Lakh Cr during the March quarter.

Amid all these, domestic institutional investors increased their stake in Paytm to 23.08% in Q4 from 20.32% in the previous quarter. Holdings of mutual funds during the period jumped to 16.6% from 14.34% earlier. 

Five new mutual funds joined the list of Paytm’s shareholders during the quarter, taking the total  to 51. The new funds included Bandhan Bank’s Large and Mid Cap Fund, which now holds a 1.32% stake in the fintech company. Insurance companies also increased their stake to 5.08% from 4.77% during this time. 

With this, Paytm turned into an Indian owned and controlled company (IOCC) as foreign investor holdings slipped below 50%. “As per the… shareholding pattern, domestic investors hold 50.3% of the company’s equity share capital in Q4 FY26, thereby establishing majority Indian ownership and control,” Paytm said in an exchange filing. 

This comes as Paytm turned profitable in Q1 FY26, reporting a net profit of ₹122.5 Cr. In Q3, the company posted a profit of ₹225 Cr on an operating revenue of ₹2,194 Cr. 

Shares of Paytm ended today’s trading session 2.9% higher at ₹1,139.4 apiece on the BSE.

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