One97 Communications, the parent organisation of fintech platform Paytm, has received permission from the Securities and Exchange Board of India (SEBI) for its Rs 16,600 crore initial public offering (IPO), according to sources kept secrecy 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 current investors can sell their shares.
28 October 2021 – It’s official: Paytm’s Rs 18,300-crore IPO to open on November 8 which was earlier estimated 16,600 crores.
The company is planning for a mid-November listing. It had listed its draft in July. The company is expected to use the proceeds for extension, including customer and merchant acquiring and investing in new business actions, acquisitions, and strategic partnerships.
This will be India’s most significant public issue so far, a record that was previously held by Coal India, 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 its journey as a value-added service provider and emerged over the years to become an online mobile payments brand.
The company spent nearly a decade catering to the VAS market. It made its first pivot with the start of a mobile recharge platform in 2010. Until then, customers used to pay cash to get their phones recharged by offline retailers. Over 90 percent of Indian telecom users had pre-paid connections in India at the time. Ten years later, the market hasn’t modified much.
Interestingly, this is not One97’s first effort to go public. In 2010, the company, which then used to give value-added services (VAS) for telecom customers, prepared to raise Rs 120 crore ($28 million basis a decade old conversion rate) through an IPO. It had to cancel its plan because of market instability.
Paytm is currently India’s second most valuable Internet company, the latest valued at $16 billion when it raised a billion dollars in November 2019, driven by T Rowe Price, Discovery Capital, and D1 Capital.
Besides these investors, the company’s key stakeholders include names like Ant Financial Netherlands, Alibaba Singapore, three funds of Elevation Capital, SoftBank Vision Fund, and BH International Holdings.
The company had measured revenue of Rs 3,186 crore for FY 20-21 vs Rs 3,540 crore in the previous year. It narrowed losses to Rs 1,701 crore during the same period from Rs 2,942 crore during the last year.