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Paytm India’s payment group has convened a shareholders ’meeting next month to approve the initial public offering that is being billed as the largest in the country, with the intention of raising $ 3 billion.
The group, backed by China’s Ant Group and Japan’s SoftBank, has named JPMorgan, Morgan Stanley, Goldman Sachs and India’s ICICI Securities to lead the matter, according to people with knowledge of the company. The bid will target a $ 29 billion Paytm valuation.
With operations from digital payments to banking, Paytm was valued at $ 16 billion in the last round of financing in 2019 and has long been a success for India’s rising technology sector.
But it was dethroned as India’s most valuable start-up this month by the edtech company Byju-renak.
There is also fierce competition from western rivals such as online payments such as Google Pay and PhonePe, a service offered by Walmart’s Flipkart e-commerce platform in India.
Five years ago, “India was governed by Paytm, which was in the driver’s seat,” said Neil Shah, an analyst at technology research firm Counterpoint. “But the money is still bleeding.
“This is a good time to make an IPO, because the competition is fast-paced and Paytm’s priority is declining; competition can cause differences in competition,” he said.
As the generation of new technology companies in India matures, many other unicorns are thinking of listing this year.
Food delivery company Zomato presented his draft brochure trying to take advantage of the large increase in online shipments in India during the coronavirus pandemic in April.
Insurance aggregator Policybazaar and Nykaa aesthetics e-commerce sites have also said they are looking at lists like Walmart’s Flipkart.
According to founder and CEO Vijay Shekhar Sharma, Paytm was one of the first to focus on digital payments and currently has 150 million active users.
But Paytm has struggled to make it profitable, even though it has reduced losses for two years in a row.
Last year, Paytm reported a loss of $ 17 billion ($ 230 million) over the previous year compared to $ 29 billion.
“We are seeing a lot of these start-ups looking at the Indian list because it is partly because of the high global liquidity,” said Gokul Rajan Cyril Amarchand, a lawyer for the capital markets of Mangaldas.
He said many of the companies ’internal lists regulated by the Securities and Exchange Commission of India are also the“ most viable option ”compared to foreign offerings or special purpose companies.
“Sebi regulations allow non-profit companies to IPO and Indian unicorns are getting a little closer to the US market based on potential results than historical results,” he said.
Paytm’s Sharma has not been a foreign controversy over the years. He was immersed in one blackmail scandal In 2018 after he was accused of trying to extort $ 2.7 million from his head of public relations.
The chief executive has been a harsh critic. “arbitrary powers and force”They supported a ban on Indian Silicon Valley companies and New Delhi in Chinese applications, even though their largest investor was Chinese.
He once tweeted that “thatTime for the best entrepreneurs in India to approach the Indians and build the best, for the Indians! “
Additional report by Hudson Lockett in Hong Kong
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