Target valuation is as high as 30 billion US dollars! Paytm, India's largest payment software, is about to go public

According to the Economic Times of India, Paytm, an Indian third-party payment e-commerce company, is preparing to go public!

Paytm's parent One97 Communications has filed a draft prospectus with the Securities and Exchange Board of India (Sebi) to raise 166 billion rupees ($2.2 billion ) in what could be India's largest initial public offering in a decade .

The prospectus also said that Paytm may also consider raising up to Rs 2,000 crore in pre-IPO funding. If that happens, the size of Paytm 's offering will be adjusted accordingly.

Data released by Paytm shows that as of March 2021, Paytm has 330 million users and 21 million merchant users. Currently, there are only 700 million Internet users in India, which means that nearly half of the Internet users in India are Paytm users.

Paytm, known as the "Indian Alipay", is currently the second most valuable startup in India, with a current market value of $16 billion. Although the company did not disclose the valuation it seeks in its IPO, people familiar with the matter said that the company's target valuation is between $24 billion and $30 billion .

It is worth noting that Alipay's parent company Ant Group holds nearly 30% of Paytm's shares through its parent company One97 Communications. However, according to the Economic Times of India, Ant Group may reduce its stake in Paytm by 5% in order to meet the Indian government's regulations on foreign investment in listed companies.

Paytm said it plans to use 43 billion rupees from the IPO funds to develop and strengthen its ecosystem. By "acquiring and retaining consumers and merchants", it will provide them with more technical and financial services support. Secondly, it will invest up to 20 billion rupees in new business plans, acquisitions and strategic partnerships. The remaining funds will be used for general corporate purposes.

Although Paytm has begun preparations for its IPO, it currently has a lot of troubles on its hands!

As of March 31, Paytm had a total debt of Rs 47.6 crore that was not structured as per the debt arrangement. The company also has an unresolved income tax issue of Rs 16 crore. In addition, there are 25 criminal cases and 40 tax cases pending against Paytm, its subsidiaries and directors.

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