Paytm IPO subscribed 18% on first day of bidding, led by strong demand from retail investors

One-97 Communications-backed digital payments company Paytm’s initial public offer (IPO) was subscribed 18 per cent on the first day of bidding till 5:00 pm. The three-day initial share sale has opened today (November 8) and will close on November 10, 2021. 

The biggest-ever IPO in a decade of Rs 18,300-crore received bids for 88.23 lakh shares against an offer size of 4.83 crore shares. Retail investors subscribed most by 78 per cent, while qualified institutional buyers and non-institutional investors have made a mute start with 6 and 2 per cent respectively. 

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The IPO comprises fresh issuance of equity shares worth Rs 8,300 crore and Rs 10,000 crore from an OFS by existing shareholders. It has fixed a price band of Rs 2,080-2,150 a piece, implying a valuation of around Rs 1.48 lakh crore, and has raised Rs 8,235 crore from anchor investors on Wednesday. 

Paytm founder, managing director, and chief executive Vijay Shekhar Sharma and Alibaba group firms will dilute some of their stake in the proposed offer-for-sale. 

The parent company of Paytm - One 97 Communications Ltd was incorporated in 2000 and it is India's leading digital ecosystem for consumers as well as merchants.  

The company, in 2009, had launched the first digital mobile payment platform, Paytm App to offer cashless payment services to customers and has become India's largest payment platform. 

Of overall fundraising, Rs 4,300 crore proceeds will be used for growing and strengthening the Paytm ecosystem, including through the acquisition of consumers and merchants and providing them with greater access to technology and financial services. 

Paytm offers payment services, commerce and cloud services, and financial services to more than 333 million consumers and over 21 million merchants (as of March 31, 2021).