Paytm IPO opens today: Total Subscription at 18% on first day of bidding
DELHI, NEW DELHI: The three-day initial public offering (IPO) of digital payment network Paytm began on Monday. The company is aiming to raise $2.46 billion in order to become India’s largest IPO.
Paytm’s IPO is the fourth by an Indian internet company, and the third after beauty products store Nykaa went public on October 28. Following that, Policybazaar held a public offering from November 1 to 3.
The offer opened for investors today and it will close on November 10. The price band for the offer has been fixed at Rs 2,080 to Rs 2,150 per equity share.
Paytm IPO Updates
Paytm, which is owned by One97 Communications, launched its initial public offering (IPO) today. This is the largest public offering in Indian financial markets history.
On November 8, the first day of bidding, the Rs 18,300-crore IPO received bids for 85.81 lakh equity shares against an offer size of 4.83 crore shares, resulting in an 18% subscription rate. The reserved component for retail investors was subscribed 76%, while the reserved portion for non-institutional investors was subscribed 2%, and qualified institutional purchasers bid for 16.78 lakh shares out of the 2.63 crore set aside for them.
Paytm is a market leader in India’s digital ecosystem for both consumers and businesses. Its entire merchant base increased from 11.2 million in March 2019 to 21.1 million in March 2021.
From Rs 2,292 billion in FY19 to Rs 4,033 billion in FY21, its gross merchandise value (GMV) has increased. It provides consumers and merchants with technology-driven, user-friendly digital products and services, as well as simple and universal access to financial services. According to its DRHP, it provided payment and banking services to 33.7 crore consumers and 2.2 crore businesses as of June 30, 2021.
Here is a look at the sources of revenue for the company:
- Payment Services: Paytm charges transaction fees, commonly known as merchant fees, which are calculated as a percentage of GMV. Consumer, convenience, and subscription fees are further sources of revenue.
- Financial Services: It charges a fee based on the services provided to the consumer. It charges a fee for credit card marketing and distribution, commission on insurance products, and a fee from the lending company.
- Commerce Services: Consumer convenience fees are charged, and merchant transaction fees are earned on tickets for entertainment, travel, and other such services.
- Cloud Services: Paytm charges a subscription fee that is either set or variable depending on the amount of transactions on the platform.
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