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Updated on: Monday, November 08, 2021, 10:29 AM IST

Paytm IPO opens today: Check here for issue size, price band, other details

The Initial Public Offering (IPO) of One97 Communications, which operates under the Paytm brand name opens one of the largest public issues today (November 8). / Representative Image |

The Initial Public Offering (IPO) of One97 Communications, which operates under the Paytm brand name opens one of the largest public issues today (November 8). / Representative Image |

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After a month long gap, the primary market is heading for a busy time, with five firms including Paytm parent One97 Communications and policybazaar parent PB Fintech have lined up their IPOs in the first half of November to raise over Rs 27,000 crore collectively.

The Initial Public Offering (IPO) of One97 Communications, which operates under the Paytm brand name opens one of the largest public issues today (November 8). The IPO will be the biggest primary issue in India since Coal India Ltd.’s share sale in 2010.

Paytm has raised Rs 8,235 crore from anchor investors ahead of its share sale.

Price band

The price band is Rs. 2,080 - 2,150 per share. OCL’s IPO will be the biggest primary issue in India since Coal India Ltd.’s share sale in 2010.

The issue is a combination of fresh and OFS. The company will not receive any proceeds from the OFS part of the issue.

75 percent of the net issue are reserved for qualified institutional buyers, while 15 percent and 10 percent of the net issue is reserved for non-institutional bidders and retail investors, respectively. The company is a professionally managed company and does not have an identifiable promoter.

Proceeds to be used for

Of the net proceeds from the fresh issue, Rs. 4,300 crore will be used for growing and strengthening the Paytm ecosystem, including acquisition and retention of consumers and merchants; Rs. 2,000cr will be utilized for investing in new business initiatives, acquisitions and strategic partnerships. Residual funds will be used for general corporate purposes.

Company strengths

Ecosystem allows it to address large market opportunities

Trusted brand, scale and reach

Its insights of Indian consumers and merchants

Product and technology DNA

Network effect creating sustainable advantages

Its leadership and culture.

Risks and Concerns

Unfavorable government policies and regulations

Fast changing technological and services landscape in the payment services domain

Unfavorable change in the payment processing charges

Declining acceptance of its payment platform or lower growth in the merchant base

Revenue concentration risk

Declining operational efficiencies and continued higher losses

''Bull markets are the best times when any company going public seems to get better premiums and valuations on the business,'' Prateek Singh, Founder and CEO, LearnApp.com.

''Tech companies in particular get a better premium because of their ability to scale exponentially, which is why we are seeing many tech startups raise cash by going for an IPO this time,'' he said.

He, further, said that the trend of technology based companies going public to continue in the immediate future until the market calms down and moves downward. So if the markets fall in the future, the IPOs will also reduce.

So far in 2021, as many as 41 companies have floated their IPOs to raise Rs 66,915 crore and Devina Mehra of First Global said the year should be closing with Rs 1 lakh crore primary market fundraise.

(With PTI inputs)

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Published on: Monday, November 08, 2021, 10:05 AM IST
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