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PB Fintech shares tumbled 5% today. Here's why

As per the report, the income ztax department would soon begin assessment proceedings against the company.

Fintech News

Glofina Global Fintech Alliance

Shares of PB Fintech Ltd, the parent of Policybazaar and Paisabazaar, plunged 5 per cent in Tuesday's trade amid a media report that suggested that the income tax authorities may soon begin assessment proceedings against online insurance aggregator, which has been under the scanner for regulatory lapses and KYC non-compliance.

The report by Moneycontrol cited a senior government official as saying that there were regulatory know your customer (KYC) non-compliance issues with PB Fintech, and that the income tax department conducted a survey over the same. There are issues of regulatory lapses, the official told Moneycontrol.

To recall, income tax officials visited Paisabazaar Marketing and Consulting Private Limited (Paisabazaar), a wholly owned subsidiary and PB Fintech Limited on December 13 and December 14 last year and enquired about certain vendors of Paisabazaar. PB Fintech had on its has provided information required by the IT Officials and shall continue to provide any further details/information that might be required by the future.

PB Fintech update

In a exchange filing, PB Fintech said: "With reference to our earlier communication dated December 14, 2023 regarding Income Tax survey with respect to our wholly-owned subsidiary Paisabazaar Marketing and Consulting Private Limited, we wish to inform that there is no new update in the said matter. The Company shall continue to provide any further details/information that might be required by the IT department," PB Fintech told stock exchanges.

PB Fintech stock performance

Following the development, the stock fell 4.72 per cent to hit a low of Rs 917.60 on BSE. Recently, the stock was in news after the Singaporean sovereign wealth fund Temasek Holdings offloaded its entire 5.42 per cent stake in the insurance aggregator for Rs 2,425 crore in a block deal.

Recently, the RBI had reportedly found hundreds of thousands of accounts at the Paytm Bank that were created without proper identification. There were also reports that the Enforcement Directorate was investigating Paytm and its founder for money laundering, which Paytm later denied as speculations.

In its Q3 review for PB Fintech, Keynote Capitals revised its earning estimates and suggested a target price of Rs 1,147 for PB Fintech. The brokerage suggested that PB Fintech was at a pivotal juncture, driven by catalysts such as renewal commission growth, strategic expansion into tier-2/3 cities through offline channels, andrigorous cost management, which it felt were poised to generate favorable operating leverage. PB Fintech also reported profitability for the first time in the December quarter and the brokerage suggested the momentum to continue.

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