Ant-backed Paytm targets $2.2 billion Indian IPO in booming e-payment market

Paytm app is seen on a smartphone in this illustration taken, July 13, 2021. REUTERS/Dado Ruvic/Illustration

BENGALURU (Reuters) -Indian digital payments leader Paytm, which counts Ant Group and Softbank among its backers, is seeking regulatory approval to raise up to 166 billion rupees ($2.23 billion) in one of the biggest stock market listings in the country.

The offering, which values the company at up to $25 billion according to sources, comes at a time of a pandemic-fuelled boom in India's digital economy and an intensifying battle for market share with Alphabet Inc's Google Pay and Facebook Inc-owned WhatsApp Pay.

The company, formally known as One97 Communications Ltd, will sell new shares worth 83 billion rupees while existing investors will sell another 83 billion rupees in stock in the offering, the homegrown fintech startup said in a regulatory filing on Friday.

"Companies within the digital space have good growth potential because of the increase in the number of internet users and wide access among the youth," said Ajit Mishra, vice president of research at Religare Broking in Noida.

The offering from Paytm, whose backers also include Berkshire Hathaway Inc, is expected to kick off a wave of IPOs by local fintech firms that are looking to tap capital markets for expansion plans.

Founded by entrepreneur Vijay Shekhar Sharma, 43, the company was thrust into the spotlight in 2016 during India's shock ban on high-value currency bank notes, which led to a surge in digital payments. It helped Paytm expand its services to insurance and gold sales, movie and flight ticketing, and bank deposits and remittances.

Paytm has said it will use the funds from the IPO to strengthen its payment network and for acquisitions.

Several Indian startups have flagged plans to go public as they cash to cash in on growing investor interest from foreign funds.

On Friday, a $1.3 billion stock offering by Indian food delivery startup Zomato, backed by Ant Group was oversubscribed by nearly eight times

Others in the pipeline include a blockbuster IPO by Walmart Inc-owned e-commerce giant Flipkart, beauty brand Nykaa and ride-hailing service Ola.

Consolidated net loss for One97 shrank to 16.96 billion rupees for the year ended March from 28.42 billion rupees a year earlier, according to the prospectus. Revenue fell 14.6% to 28.02 billion rupees.

One97 said it may consider a further issue of shares worth up to 20 billion Indian rupees ahead of the IPO.

JPMorgan Chase, Morgan Stanley, ICICI Securities, Goldman Sachs, Axis Capital, Citi and HDFC Bank are advising on the IPO.

($1 = 74.5140 Indian rupees)

(Reporting by Vishwadha Chander, Chris Thomas and Shivani Singh in Bengaluru; Editing by Subhranshu Sahu, Anshuman Daga and Saumyadeb Chakrabarty)

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights


Next In Tech News

Covid-19 vaccines: Here's how to spot misinformation on social media and fight it
FBI warns sextortionists targeting children as young as seven, adults of all ages
‘Devious Licks,’ the latest trend troubling TikTok, has been banned from platform
Opinion: Facebook is too secretive. Its oversight board should change that
Social media's love of rare plants has created a black market boom
Facebook says WSJ allegations are 'mischaracterizations,' confer 'false motives'
India antitrust probe finds Google abused Android dominance, report shows
Chinese version of TikTok limits use of app by those under 14
What to expect before buying an eScooter
Work together or fail: 'Operation: Tango' is a game built for two

Stories You'll Enjoy