New Delhi: The Securities and Exchange Board of India (SEBI) has given go ahead to One97 Communications, the parent entity of digital financial services firm Paytm to launch its Rs 16,600 crore initial public offering (IPO), the biggest in India’s corporate history. The company expects to hit the bourses by the end of this month and is planning to skip the pre-IPO share sale rounds to fast-track listing.Also Read - PayTm IPO: Fintech Firm May Skip Pre-IPO Round To Fast-Track Post-Diwali Listing
“Sebi has given approval for Paytm IPO,” the source on condition of anonymity said, adding that the company’s plan of shelving the pre-IPO raise is not related to any valuation differences. “There are no valuation differences between investors and Paytm’s management. The company is heading for an IPO directly, to adhere to the timelines it had kept in mind,” a source told Money Control. Also Read - RBI Imposes Rs 1 Crore Penalty On Paytm Payments Bank | Here's Why
According to the draft IPO documents, the company plans to raise Rs 8,300 crore through fresh issue of equity shares and another Rs 8,300 crore through the offer-for-sale route. Paytm founder, managing director and chief executive Vijay Shekhar Sharma and Alibaba group firms will dilute some of their stake in the proposed offer-for-sale. Also Read - You Can Buy Digital Gold at Re 1 During Diwali, Dhanteras: 5 Things to Know Before Purchase
Paytm Likely To Go Public Post Diwali
As per the reports of Indian Express, Paytm is expected to list its shares on the BSE and the NSE by mid-November. The company is targeting a valuation of over Rs 150,00 crore to Rs 165,000 crore from the IPO. US-based valuation expert Aswath Damodaran, who is a professor specialising in finance at the Stern School of Business at New York University, has valued the unlisted shares of the firm at Rs 2,950 apiece.
Till now, Coal India had raised the biggest IPO worth Rs 15,500 crore, listed a decade ago, in the last quarter of 2010.
About Paytm
Paytm is the country’s leading financial services player and has built a multi-stack payment architecture to bring in revenues.
As of March 31, 2021, its merchant base grew to 2.11 crore from 1.12 crore in March 2019 and gross merchandise value (GMV) almost doubled to over Rs 4 lakh crore in the financial year (FY) from Rs 2.29 lakh crore in FY 2019.
The company has reported a narrowing of its loss to Rs 1,704 crore in FY21, from Rs 2,943.3 crore in FY20 and Rs 4,235.5 crore in FY19. Total income declined to Rs 3,186.8 crore in FY21, from Rs 3,540.7 crore in FY20. Paytm has reported a negative cash flow of Rs 222.1 crore in FY21 primarily due to operating losses and additional working capital requirements.