Exclusive: IPO-Bound Snapdeal Increases ESOP Pool By 151%

Exclusive: IPO-Bound Ecommerce Giant Snapdeal Increases ESOP Pool By 151%

SUMMARY

Snapdeal will increase its Employee Stock Option Scheme 2016 from existing 1,98,890 to 5,00,000, by adding 3,01,110 ESOP options exercisable into equity shares

Snapdeal has earlier increased its authorised share capital from INR 16.8 Cr to INR 206.08 Cr

Snapdeal had also appointed Kaushik Dutta (Director, Thought Arbitrage Research Institute) as an independent director as per the SEBI listing regulations

Ecommerce giant Snapdeal has increased its ESOP pool by 151% ahead of its initial public offering.

As per the regulatory filings accessed by Inc42, the company’s shareholders have passed a resolution seeking to increase its Employee Stock Option Scheme 2016 from existing 1,98,890 to 5,00,000, by adding 3,01,110 ESOP options exercisable into equity shares of INR 1 each.

The development comes two weeks after Inc42 exclusively reported about Snapdeal increasing its authorised share capital from INR 16.8 Cr to INR 206.08 Cr.

The ecommerce player has also appointed Kaushik Dutta (Director, Thought Arbitrage Research Institute) as an independent director as per the SEBI listing regulations, the filings with the ministry of corporate affairs had earlier revealed.

The startup has also passed a resolution which states that Snapdeal’s board shall consist of no more than 15 directors and the size of the board may be increased after getting approval from its major Investors and at least one promoter.

A couple of days back, Vijay Shekhar Sharma-led digital payments decacorn Paytm has also increased its ESOP pool by 2.5X from 24 Mn to 61 Mn options, ahead of its IPO.

As per media reports, Snapdeal is considering an IPO next year and is eyeing to raise $400 Mn at a valuation of $2.5 Bn. The Delhi NCR-based ecommerce startup has reportedly appointed Bank of America, Axis Bank and JM Financial for the listing.

Founded by Kunal Bahl and Rohit Bansal in 2010, Snapdeal has to date received over $1.5 Bn from marquee investors such as SoftBank, Foxconn Technology Group, Chinese conglomerate – Alibaba Group, and Canada’s Ontario Teachers’ Pension Plan.

Snapdeal claims to have customers across 6,000 towns in the country with over 500K sellers and 200 Mn products on its platform.

The company has posted consolidated revenue of INR 916 Cr in FY20. The company’s loss increased to INR 274 Cr in FY20 from INR 186 Cr in FY19.

Snapdeal competes against the likes of US ecommerce giant Amazon and Walmart-owned Flipkart which dominates the majority of the market share in the country’s booming ecommerce market. According to Inc42 Plus, India’s ecommerce market is expected to cross over $200 Bn by 2026.