Paytm’s Vijay Shekhar Sharma at a crossroads

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Editor's note: A little over four months ago, digital payments giant Paytm—incorporated as One97 Communications Ltd—pulled off a Rs 18,300 crore initial public offering, India’s largest. The company raised Rs 8,300 crore, while existing investors sold shares worth Rs 10,000 crore. All this happened at a price of Rs 2,150 per share. The stock, four months on, trades at about Rs 570—i.e., almost three-fourths of the company’s market value has been wiped out. At the same time, the company saw losses widen 45% to Rs 778 crore in the December quarter, and earlier this month its payments bank unit was ordered not to onboard new customers by the Reserve Bank of India over “material supervisory concerns”. Its planned forays into broader banking and insurance are also under siege. Regulators remain uncomfortable with nearly a third of Paytm’s shares being held by Chinese investors. In the most damning of assessments, Macquarie’s Suresh Ganapathy—the analyst who first predicted Paytm’s spectacular stock market tanking—has said in a recent report that profitability is at least seven years away.  This is the worst time of Paytm’s life. …