Protean eGov shares plunge 34%: Should you sell or hold?
What's the story
Protean eGov Technologies Ltd's shares have plummeted over 34% in just two trading sessions.
The steep decline comes after the company was left out of the Income Tax Department's PAN 2.0 project, raising concerns of a potential revenue loss.
The stock fell by 14.12% today, inching closer to its 52-week lows, after a steep fall of over 20% yesterday.
Exclusion explained
Company excluded from PAN 2.0 project
Protean eGov Technologies Ltd had proposed to be the managed service provider (MSP) for the ambitious PAN 2.0 project.
However, the Income Tax Department did not favorably consider its bid for the next round of selection.
In an exchange filing, Protean clarified that this exclusion will not significantly impact its ongoing PAN issuance and processing operations under their current agreement with the IT Department.
Analyst reactions
Analysts express concerns over revenue impact
Brokerage firm Equirus Securities downgraded Protean's stock from 'add' to 'sell,' and cut its price target by 21% to ₹900 for March 2026.
The firm said losing PAN 2.0 contract is a major risk to Protean's topline as PAN services currently contribute to nearly half of its revenue.
However, Anand Rathi gave a more balanced view, noting the negative sentiment but saying Protean's core PAN operations remain unaffected.
Investor profile
Prominent investors hold stakes in Protean
Veteran investor Ramesh Damani held a 1.05% stake in Protean at the end of the March 2025 quarter, while Ajay Aggarwal owned a slightly higher share of 1.12%.
Despite lacking a promoter group, many state-owned and private banks are key stakeholders in Protean eGov Technologies.
These include Canara Bank (1.23%), Bank of Baroda (1.54%), Punjab National Bank (2.25%), Axis Bank (3.18%) and State Bank of India (4.93%).
Stock performance
Stock trading near 52-week low
Despite Protean's efforts to allay fears, the market reacted with intense selling. The stock continued its fall today, hitting an intra-day low of ₹981.55. This is almost 56% lower than its 52-week high of ₹2,225 it had hit in August 2024.