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India’s Paytm could launch IPO by October

written by Bella Palmer

Paytm's IPO plan comes at a time when several Indian startups prepare to go public on domestic bourses

The Indian digital payments company Paytm is expected to launch its initial public offering (IPO) near the end of October, Reuters reported on Monday (July 26). It will be the largest ever IPO in India.

Paytm also expects to break even in 18 months, Reuters said citing a “source familiar with the matter”. The firm has filed for a Rs. 166 billion ($2.2 billion) IPO, and hopes to go public before the Hindu festival Deepawali in November.

Paytm's IPO plan comes at a time when several first-generation homegrown startups in India prepare to go public on domestic bourses, led by food delivery firm Zomato which made a stellar stock market debut last week.

Paytm, backed by names such as Ant Group and SoftBank, was able to reduce its operating losses from Rs. 24.68 billion ($0.33 billion) in March 2020 to Rs. 16.55 billion ($0.22 billion) earlier this year.

Paytm is on the path to profitability now, the source said. If the company continues the way it is doing right now, 18 months is quite reasonable, assuming there is no COVID-related impact to the business.

Since lockdowns eased in India in the second quarter of FY 2021, our average monthly GMV per MTU for each quarter has grown consistently and has exceeded pre-COVID-19 levels, the IPO filing said. We are able to attract consumers by offering daily life use cases such as bill payments, mobile top-ups, money transfer, online and in-store payments, entertainment and travel tickets, online games, mini-apps across food delivery, eCommerce, ride-hailing and more.

The company is pushing its payments hardware such as point-of-sale machines and other devices to merchants, the source said, adding Paytm's software, which helps merchants manage their operations, would also be a key business over the next three to five years.


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