Saturday, 04 December 2021

SEBI gives Paytm IPO nod for Rs 16,600 crore

SEBI's gives Paytm IPO nod for Rs 16,600 crore

One97 Communication, the parent company of fintech platform Paytm, has received the nod from a SEBI for a Rs 16,600 crore initial public offering (IPO), according to sources privy to the matter.

While Rs 8,300 crore will be direct share sale, Rs 8,300 crore will be an offer for sale (OFS), where existing investors can sell their shares.

The company is planning for a mid-November listing.

It had filed its draft in July.

The company expects to use the proceeds for growth, including customer and merchant acquisition and investing in new business initiatives, assets, and strategic partnerships.

This will be India's most significant public issue so far, a record that Coal India previously held, which raised Rs 15,000 crore over a decade ago, underscoring the appetite for new-age Internet companies among institutional investors.

Vijay Shekhar Sharma founded One97 in 2000. It began the journey as a value-added service (VAS) provider and evolving over the years to become an online mobile payments company.

SEBI give Paytm IPO nod for Rs 16 600 crore 1Twitter image : @Paytm

Read More: RBI imposed a ₹1 crore fine on Paytm Payments Bank Limited

The company spent almost ten years catering to the VAS market. It made its first pivot with a launch of a mobile recharge platform in the year 2010. Until then, customers used to pay by cash to get their phones recharged by offline shops. Over 90 percent of telecom users in India had prepaid connections in India at the time. After ten years, the market remains the same.

Interestingly, this is not One97's first try to go public. In 2010, the company, which provided (value-added services) VAS for telecom customers, planned to raise Rs 120 crores $28 million based on a decade-old conversion rate through IPO. It had to cancel the plan because of a market fugitive.

Paytm is currently India's second most valued Internet company, last valued at 16 billion dollars when it raised a billion dollars in 2019, led by T Rowe Price, Discovery Capital, and D1 Capital.

Besides these investors, the company's key stakeholders include Alibaba Singapore, Ant Financial Netherlands, three funds of Elevation Capital, SoftBank Vision Fund, and BH International Holdings.

The company had clocked revenue of Rs 3,186 crore for FY 20-21 vs. Rs 3,540 crore for the last year. It reduces losses to Rs 1,701 crore during the same period from Rs 2,942 crore last year.

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