E-payment platform Paytm, formally called One97 Communications Pvt. Ltd., is aiming to raise about Rs 21,800 crore/ $3 billion in an Initial Public Offering (IPO) later in 2021, which could be the country’s largest IPO debut ever.
The platform is backed by investors like SoftBank Group Corp, Berkshire Hathaway Inc., and Ant Group. The startup plans to list itself in India around the Diwali festival season this year, which is speculated to be around November. The details of the deal are however private for now.
Paytm is targeting a valuation between 25 to $30 billion from the IPO. Their board plans to meet this Friday to formally approve the Paytm IPO. If the IPO is successful, it will surpass Coal India Ltd.’s IPO offering which generated Rs 15,000 crore in 2010, making it the country’s largest IPO so far.
Banks running this IPO include large banks like JPMorgan Chase & Co., Morgan Stanley, and Citigroup Inc., with Morgan Stanley the leading contender. The process is expected to accelerate in late June or early July 2021. To comply with SEBI’s regulations, Paytm will float 10% of shares within two years and 25% within five years.
Paytm has been focusing on monetizing its services and ramping up its revenue over the past year. It’s expanded beyond digital payments into credit cards, wealth management, and banking, to name a few. It also supports Unified Payments Interface or UPI, which the country’s financial payments backbone. Paytm has over 1.4 billion monthly transactions and 20 million merchant partners.