The INR 18,300 Cr initial public offering (IPO) of Paytm has entered its final day, but it is yet to witness robust demand from institutional and non-institutional investors.
As of 12.02 p.m, investors have placed bids for 2,71,75,218 shares (0.56 times or 56%) out of the 4,83,89,422 on offer in total.
The pace of subscription has been lukewarm so far. Compared to some of the recent IPOs i.e. Zomato and Nykaa, their offers were oversubscribed on the first day of the offer and booked nearly five times by the end of Day 2.
- Retail Institutional Investors (RII) have been at the forefront so far, with the retail portion being subscribed 1.38 times. The retail investors have bid for 1,21,61,580 shares, as against 87,98,076 shares on offer
- Qualified Institutional Buyers (QIBs) have bid for 1,42,29,432 shares, while the allocated portion consists of 2,63,94,231 shares
- Non Institutional Investors have been the laggard in this IPO. They have subscribed to 7,84,206 shares (0.06 times) out of the 1,31,97,115 shares.
At the end of Day 2, the mega IPO of fintech giant was subscribed 48%.
The moderate response comes despite a strong investor interest in the anchor round on November 3rd, wherein Paytm raised INR 8,235 Cr ($1.1 Bn), making it the largest anchor round in India. The anchor round was oversubscribed 10 times, by investors including Blackrock, with INR 1,045 Cr investment, CPPIB (INR 938 Cr), Birla MF invested (INR 555 Cr) and GIC (INR 533 Cr).
With the response witnessed so far, grey market premiums now suggest that the shares may get listed around INR 60 higher from the issue price band of INR 2,085 – INR 2,150.
The IPO includes a fresh issue of INR 8,300 Cr worth of shares and an offer for sale (OFS) of INR 10,000 Cr.
The Delhi NCR based fintech decacorn is going public at a valuation of $19.5 Bn – $20 Bn. It was valued at $16 Bn when it raised $1 Bn from Ant Financials, SoftBank Vision Fund.
Founded by Vijay Shekhar Sharma in 2000, Paytm began its journey as a value-added service provider. It evolved over the years with different fintech solutions to become an online mobile payments firm.