Paytm followed in Zomato’s footsteps, announcing plans to go public in Mumbai. The IPO is
anticipated to become India’s largest tech stock launch to date, bringing the country’s digital
unicorns in the spotlight once again and raising expectations.
Paytm Expects to Raise Billions in Public Financing
Paytm, one of India’s leading digital payments providers, was
recently reported to have filed a
draft prospect for an Initial Public Offering (IPO) with the Securities and Exchange Board in
Mumbai. Planning to draw in up to Rs 166 billion (~$2.2 billion), Paytm has joined Zomato which also began raising public financing earlier in July.
While the food delivery company is aiming to sell shares worth $1.3 billion, Paytm is expected to successfully become the largest listed tech firm in India, bringing its total valuation to around $25 billion, according to industry analysts.
Zomato also has a more limited business scope, even though it is important in people’s daily
Paytm has some important institutional investors at this stage, including Ant Group (Alibaba
affiliate), Softbank and Berkshire Hathaway. Already one of the Union’s largest tech startups, the payment provider is likely to almost double its valuation from last year’s private fundraisings.
India’s New Generation Economy Is All Digital
Paytm has gone a long way. The brand was launched in 2010 as a service for buying prepaid
mobile phone plans and paying certain bills online. Its landmark mobile wallet saw RBI’s green
light in 2012, becoming the core of its business operations. A couple of years down the line,
Paytm began establishing important partnerships, becoming a preferred online payment
provider for Uber and Indian Railways.
And its recent success is not surprising. The growth of online payments reflects the importance
and size of the online market in India. After large cash payments were ruled out by the Centre in
2016, the average desi consumer had to make some changes in a country with mostly cash
transactions up to that point.
Mass smartphone adoption only facilitated the rise of Paytm’s mobile payments app. India’s e-
pandemic-related digital transition.
Online retail is still estimated to be a fraction of total retail across Bharat. Yet, the Government
has indicated in the past – in its Digital India initiative – that eliminating the grey economy and
Tech Unicorns Lead the Way
When Zomato revealed its IPO plans, industry experts announced that shares made available
were already the largest tech offer on Indian stock markets. Tata Consultancy Services previously topped the list with a $1.17 billion IPO way back in 2004.
Zomato’s total valuation is now almost $8 billion. But it is merely one of hundreds of Indian tech
unicorns that are growing and attracting investor interest, despite some concerns with long-term business performance. None of those worth $1 billion or more had previously gone public.
Flipkart was already bought for more than a billion dollars but was directly acquired by
institutional investors like Walmart, Softbank affiliates, Canada pension funds and GIC. Despite
the fact that the e-commerce company raised additional $3.6 billion in its latest funding round, it
is also reportedly looking at an IPO. Current estimates place its total value at almost $38 billion.
