Planned smaller IPOs could have a harder time pricing shares if there is a reduced appetite for new listings. The shares of Paytm rival One MobiKwik Systems Ltd. have fallen about 40% in the so-called grey market.

Paytm shares have fallen about 30% since it started trading last week, with a rebound on Tuesday not enough to erase losses from the two previous sessions. Some companies that were seeking to benefit from the flood of transactions in India’s booming IPO market so far this year may now rethink the timing and pricing of their issues, according to Edelweiss Financial Services Ltd.

Valuation is likely to become the main sticking point for those seeking to tap the market. Paytm’s valuation — around 26 times price-to-estimated sales for the financial year 2023 — towers above the benchmark S&P BSE Sensex Index on about 4 times.