IPO of Zomato has been a blockbuster event this year. The social media content was flooded with creativity of content writers and graphic designers. Segments, revenue mix, offerings and expenses were explained so precisely that a layman can understand the operating structure of digital food delivery platform. The overhang of Zomato IPO is over now and market participants are looking for new trigger to keep themselves busy. In order to keep investors occupied, market participants have got new triggers in form of Paytm and Mobikwik IPOs. Giant payment solution platforms have filed their DRHP to market regulator SEBI.
Think tanks in the Indian equity market feel that the new tech culture in awake of startups listing is going to change the Indian equity market forever. New tech culture will change the earlier benchmarks of valuation parameters and ideology of investors. Startups are popular among the general public and this will push various people to turn them into investors as the familiarity with the popular brands raise confidence level among them.
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Two giant payment solution platforms are going to adorn the Indian equity market as they have filed their DRHP to market regulator SEBI.
Paytm
Founded in 2009 by Vijay Shekhar Sharma, Paytm is India’s leading digital ecosystem for consumers and merchants. The company offers payment services, commerce and cloud services, and financial services to 333 million consumers and over 21 million merchants registered with them, as of March 31, 2021. Two-sided (consumer and merchant) ecosystem enables commerce, and provides access to financial services by leveraging technology to improve the lives of their consumers and help their merchants grow their businesses.
As per the DRHP, the issue size of Rs. 16,600 cr. is a mix of fresh issue and offer for sale.
Offer for Sale: The object of the Offer for Sale is to allow the shareholders to sell an aggregate of Rs. 8,300 crores worth of equity Shares held by them.
Fresh Issue: The payment solutions platform has planned to raise fresh capital aggregating up to Rs. 8,300 Cr. The net proceeds from fresh issue will be utilized for funding organic and inorganic growth.
Organic Growth: Paytm will spend on technology and expand its infrastructure for acquisition and retention of customers that will strengthen payment ecosystem.
Inorganic Growth: Growth by investing towards acquisitions and strategic alliances.
Mobikwik
Founded in 2009 by Bipin Preet Singh, One Mobikwik Systems Ltd. is a fintech company. It is one of the largest mobile wallets (MobiKwik Wallet) and Buy Now Pay Later player in India, based on mobile wallet gross merchandise value in FY 2021. The payment gateway platform leverage big data analytics and deep data science (including machine learning) to continuously delight users and merchants. The company commenced its operations in 2009 with the MobiKwik Wallet so that users could load money into a mobile wallet and use it to pay their utility bills in a single click. In May 2019, the firm launched MobiKwik Zip, a flagship BNPL product, with a focus on the Indian middle-class population to enable them to make payments for daily life use cases.
As per the DRHP, the issue size of Rs. 16,600 cr. is a mix of fresh issue and offer for sale.
Offer for Sale: The object of the Offer for Sale is to allow the shareholders to sell an aggregate of Rs. 400 crores worth of equity Shares held by them. Selling investors are: American Express Travel Related Service Company, Bajaj Finance, Bipin Preet Singh, Cisco Systems, Sequoia Capital, Tree Line Asia Fund and Upasana Taku.
Fresh Issue: The payment solutions platform has planned to raise fresh capital aggregating up to Rs. 1,500 Cr. The net proceeds from fresh issue will be utilized for funding organic and inorganic growth.
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