Paytm’s parent company, One97 Communications Ltd. (OCL), launches its initial public offering (IPO) to increase ??18,300 crore, which opens November 8. The price range is set at Rs 2,080 – 2,150 per share. Paytm’s successful IPO will be the largest primary issue in India since the sale of Coal India Ltd shares in 2010.
The IPO, which ends on November 10, includes the issuance of new shares worth ??8,300 crore and offer to sell (OFS) by existing shareholders up to ??10,000 crores.
“While ratings may seem expensive, Paytm has become synonymous with digital payments via mobile and is the market leader in the mobile payment space. Patym is well positioned to benefit from the 5x exponential growth in mobile payments between FY2021 – FY2026 and therefore believes the valuations are justified. We recommend that investors SUBSCRIBE to the show, ”said Jyoti Roy – DVP- Equity Strategist, Angel One.
One 97 communications (Paytm) is India’s leading digital ecosystem for consumers and merchants. It is the largest payment platform in India, with a GMV of around ??4 lakh crore in FY21. As of June 30, 2021, it offers payment services, commerce and cloud computing services and financial services to 33.7 crore of consumers and over 2.2 crore of merchants.
Choice Broking analysts recommended long-term underwriting based on big market opportunities, product DNA and technology, leadership and culture. However, he sees the rapidly changing technology and service landscape in the payment services arena, the risk of revenue concentration, declining operational efficiency and ever-increasing losses as key risks and concerns.
Paytm plans to use the proceeds from the new issue to expand its business lines and acquire new merchants and customers. The company skipped the pre-IPO funding round to accelerate the launch of the initial stock sale.
Brokerage firm ICICI Securities has built extremely competitive markets with constantly changing technology, failure to attract traders and volumes can negatively affect business, reliance on payment services for the majority of income as key risks and concerns.
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