One97 Communications Ltd., the parent brand which operates Paytm, is looking to set a price band of Rs 2080-2150 for its upcoming IPO at a valuation of $20 billion, according to three people aware of the discussions.
The IPO will open on November 8 and is expected to close on November 10, Mint reported earlier on Thursday.
In what could be one of the biggest IPOs on the Indian bourses, One97 Communications Ltd has effectively increased its public issue size to Rs 18,300 crore from Rs 16,600 crore earlier.
Paytm is now expected to increase the secondary share sale from existing investors to ₹10,000 crore as a part of the increased IPO size. The primary portion of the fresh share issue will remain unchanged at ₹ 8,300 crore, Mint reported on October 27.
Roughly half of the offer for sale by existing shareholders will be by Paytm’s biggest investor Ant Financial, which currently owns 29.6% of the company.
"Paytm may target a price band of ₹2080-2150. While the company could have gone for a higher band, it chose the current price band. Accordingly, the company might look at a valuation of $20 billion,” said one of the persons quoted above.
The company plans to use ₹4,300 crore of the fresh issue to grow its existing business lines and acquire new merchants and customers, according to its draft share sale documents.
Investment banks, including Morgan Stanley, Goldman Sachs Group Inc., Citigroup Inc. and ICICI Securities Ltd, are managing the share sale.
The Securities and Exchange Board of India (Sebi) cleared the Noida-based digital payments company’s IPO, last week.
Led by founder and chief executive Vijay Shekhar Sharma, the 11-year-old Paytm has expanded beyond digital payments into newer categories of lending, gaming, wealth management, financial services and digital commerce.
For the year ended 31 March, Paytm’s consolidated revenue shrank 11% to ₹3,187 crore, but it managed to cut losses by 42% to ₹1,701 crore.