Kickstarts work on India’s largest-ever listing, expected towards end 2021
Fintech platform Paytm, backed by Japan’s SoftBank Group Corp and China’s Ant Group Co Ltd, is eyeing an initial public offering seeking to raise as much as $3 billion towards the end of 2021.
The preparations for the IPO have already started and a formal approval of the board is expected in the coming days.
“Once the approval comes over the next few days, the preparation, including filing of documents and getting approvals can take five-six months,” said another source, adding that the final decision on the timing of the IPO would depend on market conditions.
A Bloomberg report said Paytm has appointed investment banks Morgan Stanley, Citibank and JP Morgan to manage the IPO and is targeting a valuation of about $25-30 billion.
Backed by SoftBank Group, Berkshire Hathaway Inc and Ant Group, which owns China’s largest digital payment platform Alipay, Vijay Shekhar Sharma-promoted Paytm is understood to be also zeroing-in on law firms to manage the listing.
“While an IPO was in the works for some time for Paytm, it now seems to be a conducive time to get the ball rolling,” said the first source.
Paytm did not respond to an email query sent by BusinessLine on the issue.
Sharma, who is the founder and CEO of Paytm, has indicated that the company would look at a listing after cutting down on losses, but without giving a definite time frame.
The country’s digital payments and fintech sector has been booming with the Covid pandemic fuelling growth in the last one year. Payment companies such as Mobikwik, too, are understood to be looking at a listing while food delivery platform Zomato has filed for an IPO of ₹8,250 crore.
According to the Hurun India Unicorn Index 2020, at $16 billion, Noida-based Paytm was the highest valued Indian unicorn. “Paytm was founded in 2010, with an initial investment of $2 million,” it had said.
Portfolio of services
Paytm, which offers full-stack payments and financial solutions to consumers, offline merchants and online platforms, has diversified into other financial services including Paytm Insurance and Paytm Money. Sharma and One97 Communications together also own Paytm Payments Bank, which has about 64 million accounts.
Paytm claims to be the leader in digital payments with over 1.4 billion transactions in March. With over 20 million merchant partners on board, it has the highest market share in offline payments and about a 15 per cent month-on-month growth.
In terms of UPI payments, Paytm Payments Bank app is the third most used after PhonePe and Google Pay.