Paytm FPO

Last Updated: 14 December 2021 8:06 PM by 5Paisa

The One97 Communications subsidiary, Paytm IPO has opened for subscription from 8 November to 11 November with an aim of raising Rs.18,300 crore. This IPO is set to be 22% bigger than the largest IPO till date- Coal India, which raised Rs.15,000 crore in 2010. 

Rs.2080- Rs.2150 has been set as the price band of the IPO, with a minimum investment amount of Rs.12,900 (6 shares). The fresh issue portion of the IPO is Rs.8300 crore and the rest is an OFS. The shares are to be credited to the respective demat accounts by 17 November and the company is supposed to be listed on the stock exchanges by 18 November.

On the first day of subscription, the public issue has been subscribed 0.73 times in the retail category. 

Objectives of the IPO:

1. Out of the Rs.8300 crore that the company is aiming to raise through fresh issue, Rs.4300 crore is being used to strengthen and grow the Paytm ecosystem, client and merchant retention and acquiring of newer technology and financial services
2. Rs.2000 crore is to be used for business acquisitions, partnerships and new business initiatives
3. The rest of the money is to be used to general corporate purposes
 

The company was promoted by Vijay Shekhar Sharma way back in 2000 and offers a complete digital payment ecosystem in India. Apart from offering its own proprietary wallet and bank account, The company also facilitates commerce, bill payments and bank to bank transfer of funds on its platform, including UPI transfers.

As of March 2021, it has a client base of over 33 crore who transacted on the platform with 2.10 crore registered merchants. In its last round of funding in 2019, the company was valued at $16 billion and it is expected that its valuation post-IPO would be in the range of $25 billion to $30 billion making it among the valuable digital properties in India.

Paytm has been making net losses over the last 3 years, although the net loss has been narrowing with a gradual fall in the promotional expenditure. Here is a quick summary.

Paytm Financials