Haitong has initiated coverage on One 97 Communication (Paytm) with an 'Outperform' rating and a target price of ₹1,410, indicating a potential upside of 26%. This comes after Paytm's shares have fallen 20% from their 52-week peak of ₹1,381 on the National Stock Exchange (NSE). Despite this decline, Paytm's stock has shown resilience, trading 31% higher year-on-year and rebounding 16% in April. Haitong's optimistic outlook is based on several factors: Paytm's leadership in India's retail digital payments, a projected 4X increase in net profit over FY26-28E, and a significant growth potential in merchant lending, where only 7% of merchants currently utilize these services. The brokerage anticipates a 38% compound annual growth rate (CAGR) in net payments revenue, alongside an improvement in margins driven by various factors including increased electronic transactions and regulatory approvals. Overall, Haitong believes Paytm is well-positioned to capitalize on the growing digital payment landscape in India.