Mobile payments firm Paytm kicks off India's biggest IPO

India's biggest-ever archetypal nationalist offering opened Monday with integer payments level Paytm looking to rise astir $2.5 billion, successful what has already been a grounds twelvemonth for stock listings.

Paytm is backed by Chinese tycoon Jack Ma's Ant Group, Japan's SoftBank and Warren Buffett's Berkshire Hathaway, which unneurotic ain astir a 3rd of the company.

The steadfast was founded hardly a decennary agone by Vijay Shekhar Sharma, the lad of a schoolteacher who says helium learned English by listening to stone music.

He was ranked India's youngest dollar billionaire 4 years agone astatine the property of 38 and present has a net worth of $2.4 billion, according to Forbes. He owns a astir 14-percent stake.

Paytm was issuing caller shares worthy 83 cardinal rupees ($1.1 billion), with existing shareholders selling stocks worthy $1.34 billion, according to the prospectus.

The IPO is expected to marque Paytm India's astir invaluable tech institution with a valuation of $20 billion, up 25 percent from 2 years ago.

The level was launched successful 2010 and rapidly became synonymous with integer payments successful a state traditionally dominated by currency transactions.

It has benefited from the government's efforts to curb the usage of cash—including the demonetisation of astir each banknotes successful circulation 5 years ago—and astir recently, from Covid.

"I didn't cognize corona would hap but Paytm was precise utile to maine during the pandemic," Mumbai market store proprietor Naina Thakur told AFP.

Thakur said astir a 3rd of her customers wage her for milk, breadstuff and different regular groceries via Paytm.

"It's overmuch easier than a slope transportation due to the fact that they lone request my mobile fig to wage and I get the colony wrong 7 hours," she said.

Thakur is 1 of astir 22 cardinal Indian store owners, taxi and rickshaw drivers and different vendors who judge payments arsenic debased arsenic 10 rupees ($0.13) utilizing Paytm's ubiquitous blue-and-white QR codification stickers.

The level had 337 cardinal customers astatine the extremity of June, according to the company's regulatory filing. In 2020-21 it undertook transactions worthy much than $54 billion.

The fig of mobile payments successful India has skyrocketed, accounting for 26 cardinal transactions successful the 2020-21 fiscal year.

Mumbai-based fiscal investigation steadfast Motilal Oswal estimates mobile integer payments volition transverse $3.1 trillion successful worth by 2026.

Foreign giants person besides sought to drawback a portion of the pastry including Google and Amazon. Another large subordinate is PhonePe, owned by Flipkart successful which US retail elephantine Walmart owns a bulk stake.

'May not execute profitability'

But Paytm has made continual losses and is not definite erstwhile it volition marque a profit. It reported a nett nonaccomplishment of 17 cardinal rupees past twelvemonth connected revenues of astir 32 cardinal rupees.

"We expect to proceed to incur nett losses for the foreseeable aboriginal and we whitethorn not execute profitability successful the future," the prospectus warned.

Paytm has reported antagonistic currency flows for the past 3 years, chiefly owed to operational losses.

With its $2.46 cardinal target, Paytm would surpass Coal India's $2 cardinal contented successful 2010 to go India's biggest IPO.

Ahead of the offer, Paytm raised 82.35 cardinal rupees from 74 anchor investors including BlackRock and the Canada Pension Plan Investment Board past week.

Paytm volition contented shares successful a terms set of 2,080-2,150 rupees successful the offering, which is slated to adjacent connected Wednesday.

Indian companies person raised a grounds $9.7 cardinal done IPOs successful 2021 truthful far, figures from marketplace show Prime Database showed.

Food transportation elephantine Zomato was the country's biggest IPO of the twelvemonth until present with its $1.3 cardinal stock contented successful July.

This year, India has besides seen a grounds fig of unicorns created—start-ups with a valuation of $1 cardinal oregon more—benefiting from investors spooked by a crackdown connected exertion giants successful China.

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© 2021 AFP