Paytm to raise INR 16,600 crore through the biggest Indian IPO
One97 Communications Pvt. Ltd., the parent company of Paytm, has filed draught papers with India's markets regulator to raise Rs 16,600 crore ($2.2 billion) in what is expected to be the largest Indian initial public offering (IPO) in at least a decade.
According to the draught red-herring prospectus the Paytm IPO would include a fresh issue of shares worth Rs 8,300 crore ($1.1 billion) and an equally large secondary share sale.
Significant investors will sell shares through an offer for sale, including China's Ant Group and Alibaba Group Holding Ltd., as well as Japan's SoftBank Group Corp. and Elevation Capital (OFS).
If Paytm raises Rs 2,000 crore in a pre-IPO round, as the company intends, the size of the new issue could be reduced. According to the DRHP, “If the Pre-IPO placement is completed, then the fresh issue size will be reduced to the extent of such pre-IPO placement.”
Paytm shareholders, most notably Ant Group, are expected to dilute their stakes in the company through an OFS in the IPO. The IPO's OFS component will be Rs 8,300 crore.
The Paytm IPO, which is expected to hit national stock exchanges in November, will be one of the largest in dollar terms, following Coal India ($3.3 billion) in 2010 and Reliance Power ($2.4 billion) in 2008.
Though the company has not disclosed the valuation it is aiming for, sources told that the company is aiming for a valuation of $24 billion to $30 billion.
According to souces, Ant Group is planning to sell about 5% of its 30.33 percent stake in Paytm parent One97 Communications before the latter goes public on Indian exchanges. According to sources, Paytm wants to reduce Ant Group's stake to less than 25% in order to meet Sebi requirements for listing as a "professionally managed company."
According to estimates shared in the company's annual report, One97's consolidated revenue from operations fell 14 percent year on year to Rs 2,802 crore in FY21. However, losses fell to Rs 1,701 crore in FY21 from Rs 2,942 crore in FY20. Marketing and promotional expenditures fell 61 percent to Rs 532 crore, while total expenses fell to around Rs 4,783 crore from Rs 6,138 crore the previous year.
Paytm, founded by Vijay Shekhar Sharma, is currently the second most valuable Indian startup, valued at $16 billion.
According to the draught red-herring prospectus the Paytm IPO would include a fresh issue of shares worth Rs 8,300 crore ($1.1 billion) and an equally large secondary share sale.
Significant investors will sell shares through an offer for sale, including China's Ant Group and Alibaba Group Holding Ltd., as well as Japan's SoftBank Group Corp. and Elevation Capital (OFS).
If Paytm raises Rs 2,000 crore in a pre-IPO round, as the company intends, the size of the new issue could be reduced. According to the DRHP, “If the Pre-IPO placement is completed, then the fresh issue size will be reduced to the extent of such pre-IPO placement.”
Paytm shareholders, most notably Ant Group, are expected to dilute their stakes in the company through an OFS in the IPO. The IPO's OFS component will be Rs 8,300 crore.
The Paytm IPO, which is expected to hit national stock exchanges in November, will be one of the largest in dollar terms, following Coal India ($3.3 billion) in 2010 and Reliance Power ($2.4 billion) in 2008.
Though the company has not disclosed the valuation it is aiming for, sources told that the company is aiming for a valuation of $24 billion to $30 billion.
According to souces, Ant Group is planning to sell about 5% of its 30.33 percent stake in Paytm parent One97 Communications before the latter goes public on Indian exchanges. According to sources, Paytm wants to reduce Ant Group's stake to less than 25% in order to meet Sebi requirements for listing as a "professionally managed company."
According to estimates shared in the company's annual report, One97's consolidated revenue from operations fell 14 percent year on year to Rs 2,802 crore in FY21. However, losses fell to Rs 1,701 crore in FY21 from Rs 2,942 crore in FY20. Marketing and promotional expenditures fell 61 percent to Rs 532 crore, while total expenses fell to around Rs 4,783 crore from Rs 6,138 crore the previous year.
Paytm, founded by Vijay Shekhar Sharma, is currently the second most valuable Indian startup, valued at $16 billion.
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