Paytm’s Rs 18,300 crore IPO got 1.89 times oversubscription

Paytm’s biggest public issue ever in India, the goal is to raise 18,300 crores on a band of Rs. 2,080-2,150, Company Valuation 1.39 trillion at the top end.

Data from the exchanges showed that the Qualified Institutional Buyer segment was subscribed 2.79 times, while the retail book value was around Rs. 1,830 crores, was subscribed 1.66 times at the end of the last day. In all, investors bid for 9.14 crore shares against the 4.83 crore shares available.

“We are overwhelmed by the excellent response to the Paytm IPO shown by institutional investors, financial giants, mutual funds and of course, retail investors. At Paytm, our ethos has always been to offer technology and financial services that can empower citizens to improve their lives, merchants to grow their businesses and impact our communities in positive ways. Paytm’s official spokesperson said, “We look forward to continuing our efforts for financial inclusion for the underprivileged and underserved population of the country.”

According to a report in Mint, Canada’s pension fund CPPIB doubled its bet on the Noida-based company, with a bid of approx. 1,280 crores. The fund had also participated in the anchor book allocation of the IPO a day before the issue was opened to wider investors. Last week, Paytm had picked up 8,235 crore from anchor investors, the anchor round was oversubscribed 10 times.

The issue is a combination of fresh and offer for sale. Out of the net proceeds from the fresh issue, Rs 4,300 crore will be used to grow and strengthen the Paytm ecosystem, including acquisition and retention of consumers and merchants. Out of total, 2,000 crore will be used for investment in new business initiatives, acquisitions and strategic partnerships. In addition, the balance amount will be used for general corporate purposes.

Paytm is India’s largest digital ecosystem for consumers and merchants with a Gross Merchandise Value (GMV) 4 trillion in FY21. GMV, or the total value of goods sold over a period, measures the use of the Site to sell goods owned by others. As of June 30, 2021, Paytm provides payment services, commerce and cloud services and financial services to 333 million consumers and 22 million merchants registered with it.

Paytm derives most of its revenue from the transaction fees that they collect from merchants for payment services. Paytm had negative cash flow from operating activities for FY19, FY2020 and FY21, mainly on account of operating losses and additional working capital requirements.

Paytm, which started as a bill payment and mobile recharge platform in 2010, gradually evolved into a payments-based ‘super app’ and covers payments, credit, insurance, merchants, wealth management, e-commerce services Developed into a comprehensive payment ecosystem. among others.