According to a recent report, Paytm is targeting a $3 billion of IPO (Initial public offering), which is most likely to be the largest ever debut for India. The company which is formally called One97 Communications Ltd, is planning to list in India around November and is aiming a valuation of around $25 billion to $30 billion.
The start-up is backed up by investors including Warren Buffet’s Berkshire Hathaway Inc., Softbank Group Corp. of Japan, and Ant Group Co. of China. Its IPO plans come at a time when the COVID-19 pandemic has raged up demand for digital payment platforms in India, intensifying a battle for market share with Alphabet Inc.’s Google and Facebook Inc.-owned WhatsApp Pay and Walmart Inc. owned- PhonePe.
Adding to the information, if the IPO goes through, the share sale would probably pass on Coal India’s 2010 offering, which as of now is the largest IPO in the whole country. The One97 board are planning to meet this Friday to officially approve the IPO, said the sources. Paytm had declined to comment in response to emailed questions.
The IPO public market debut will include a mix of new and existing shares to meet the regulatory obligations in India. The country’s regulations require that 10% of shares are floated within two years and 25% within five years’ time span.
Banks which shortlisted to run the Paytm offering include Morgan Stanley, Citigroup Inc. and JPMorgan Chase & Co., with Morgan Stanley the leading participant in the run. The process is expected to get in action sometime in late June or early July. The banks did not immediately and actively respond to requests for the responses.
In the company’s recent blog post, the company made it clear that Paytm has over 20 million merchant partners and its users make 1.4 billion monthly transactions. CEO Sharma said Paytm had its best ever quarter in the first three months of this year after pandemic-related spending gave a boost to digital payments.
Paytm, curated by founder and Chief Executive Officer Vijay Shekhar Sharma, he has been focusing on building up revenue and monetizing its services over the few past year. It has expanded beyond digital payments into banking, credit cards, financial services, wealth management and digital wallets too. It also supports India’s financial payments fundamental pillar, the Unified Payments Interface or UPI.
As per Paytm Payments Bank, no other beneficiary bank has been able to cross the milestone of 400 million monthly transactions. In fact, it is rapidly gaining attention and growth, and has registered 164.47 million transactions in the same month.
Paytm has also achieved an all-time high monthly target by creating over one million new savings and current accounts, which has now estimated to the total number of bank accounts to 64 million.