Paytm IPO opens next week: Price band and other details you need to know

Published on Nov 02, 2021 11:45 AM IST
From starting out as a digital wallet to simplify mobile recharging, Paytm rapidly grew into an all-round quick payment option. The company plans to raise over $1 billion with anchor investors ahead of IPO launch.
A clothes store displays the QR code for the Paytm digital payment system in Bengaluru.(Bloomberg Photo)
A clothes store displays the QR code for the Paytm digital payment system in Bengaluru.(Bloomberg Photo)
By | Written by Amit Chaturvedi, Hindustan Times, New Delhi

Digital payments company Paytm plans to raise over $1 billion with anchor investors ahead of the launch of its blockbuster initial public offer (IPO) next week. The IPO will open on November 8 and will be available for subscription till November 10.

The IPO will comprise issuance of fresh equity shares worth $1.1 billion ( 8,300 crore) and Offer for Sale (OFS) by existing shareholders to the tune of $1.3 billion ( 10,000 crore).

The $2.4 billion ( 18,300 crore) offer will be the biggest in the country after Coal India's IPO in 2010 wherein the state-owned had garnered $2.03 billion ( 15,200 crore).

Here are the key points about Paytm IPO:

• The price band for the IPO will be between 2,080-2,150 per share, implying an enterprise value of $19.3 to $19.9 billion, according to Sudarshan Ramakrishna, Managing Director of Goldman Sachs India Securities.

• The company skipped pre-IPO funding round to expedite launch of the initial share sale.

• Through the OFS, Managing Director and CEO of Paytm's parent company One97 Vijay Shekhar Sharma will offload shares worth up to $53.94 million ( 402.65 crore) while Antfin (Netherlands) Holdings will sell shares to the tune of $643 million ( 4,704.43 crore).

• Paytm received approval from the capital markets regulator for its IPO last month. It was already been cleared by by the Securities and Exchanges Board.

• The fintech platform is backed by Ant Group, SoftBank's Vision Fund and Berkshire Hathaway. Ant Group is Paytm's largest shareholder with nearly 30 per cent stake.

• Paytm's revenue from operations increased by 62 per cent in the first quarter of financial year 2021-22.

• In financial year 2021, the company reported a Gross Merchandise Value of $53 billion ( 4 lakh crore).

• In the first quarter of FY'22, the company's payments and financial services revenue alone stood at 689.4 crore contributing to 77 per cent of its total revenue. The company incurred a loss of 2.9 crore in the quarter ended June 2021.

• From starting out as a digital wallet to simplify mobile recharging, Paytm rapidly grew into an all-round quick payment option.

• The 2016 demonetisation played a role in pushing merchants to accept payments digitally and led to phenomenal growth of Paytm.

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