Paytm Founder Vijay Shekhar Sharma Laments His Choice Of Investment Bankers For IPO

Paytm founder and CEO Vijay Shekhar Sharma has said he regrets his choice of bankers for the fintech giant’s initial public offering (IPO). 

“I have been an entrepreneur long enough now. I have a regret of not choosing the correct bankers for the IPO,” Sharma said during Tie Delhi NCR’s India Internet Day 2024, according to a report by Moneycontrol.

Further, Sharma also compared Paytm’s listing with Infosys. “In NR Narayana Murthy’s time, his driver made INR 1 Cr, but when Paytm listed, at least 20 people made INR 100 Cr,” CNBC quoted him as saying.

Paytm went public in November 2021. ICICI Securities, JP Morgan, Goldman Sachs, Morgan Stanley, HDFC Bank, and Citi were its investment bankers. Its total issue size was INR 18,300 Cr. The public issue comprised a fresh issue of up to 3.86 Cr equity shares, aggregating up to INR 8,300 Cr, and an offer for sale of up to 4.65 Cr equity shares, aggregating up to INR 10,000 Cr by the selling shareholders.

While the price band for the IPO was set at INR 2,080 – INR 2,150, the startup’s shares opened on the NSE at INR 1,950 on November 18,2021. After listing at a 9.3% discount to the issue price of INR 2,150, the shares dipped further to end 27% lower from the issue price at INR 1,560 on the listing day. 

It is pertinent to note that the startup’s all-time high stands at INR 1,961.05, slightly higher than its listing price. Shares of Paytm ended today’s trading session 4.66% lower from the previous close at INR 672.40 on the BSE. This was over 65% lower compared to its IPO issue price. 

Besides, Paytm’s valuation has also dropped  significantly since 2021. While Paytm’s valuation at IPO price stood at $19 Bn, it is currently valued at $5.1 Bn. 

The development comes at a time when a number of new-age tech companies have gone public this year and many more are awaiting SEBI nod for the launch of their IPOs. Nearly all the startups that went public in recent times have seen hefty increases in their share prices compared to their issue price. TBO TEK, Awfis, ixigo, Ola Electric, FirstCry, and TAC Infosec are among these startups. 

Many of these startups went public at a lower valuation compared to their last private valuation. For instance, Ola Electric listed at a valuation of $4 Bn, 25% lower than its last private valuation of $5.4 Bn. 

“Ola Electric and ixigo left money on the table for new investors during their IPO,” GSF Accelerator’s founder and CEO Rajesh Sawhney remarked during Inc42’s Money X on Thursday (September 26).