Paytm raised $1.104 million in India’s largest ever anchor round in its initial public offering. This is as India’s most iconic startup ecosystem grows closer to listing on the public markets.
Blackrock, GIC and Canada Pension Plan Investment Board were among the investors that financed the anchor round. Paytm stated in a filing to a local exchange. According to someone familiar with the matter, Paytm shares were oversubscribed 10 times.
Paytm now has nearly half the $2.45billion capital it needs to raise through the IPO. Wednesday’s investment means that Paytm is now able to secure the remaining funds. In a conference call last week, the startup said it is looking for a valuation of more than $19 billion to launch its IPO. Paytm, which is supported by Alibaba, Berkshire Hathaway, and SoftBank was valued at $16 billion during its previous round of funding in 2018.
Blackrock’s $140 million and CPPIB’s $126 million investments are the largest Indian IPO investment by institutional investors. The anchor round was also attended by Abu Dhabi Investment Authority and Dutch pension investment company APG, City of New York.
Paytm will allow bidders to place their shares for three days beginning November 8. The share price range for the shares is between 2,080 and 2,150 Indian rupees ($27.9 – $28.85). TechCrunch has previously reported that the startup plans to list in November 18.
Paytm would be able to surpass the record $2.07 million initial public offering made by Coal India 11 year ago, if it is successful in listing.
Paytm was launched in 2009 to allow users to make digital payments using their smartphones and top up their credit. Paytm has expanded to offer a variety of services, including e-commerce marketplace, payment gateway, movie and travel ticket bookings, insurance, and digital gold.
Vijay Shekhar Sharma is the founder of the startup. He says that he has “created an payments-led superapp, through which our consumers can offer their consumers innovative and intuitive digital services, and more than a quarter of them transact annually.”
Paytm revealed in a filing that it had earned $118 million from its operations during the quarter ended June, an increase of 62% over the previous quarter. Paytm reported that Q2 saw startup losses rise to $50.9million. This was due to additional promotional and marketing campaigns.
Paytm’s IPO occurs at a moment when India’s digital economy is thriving and local stock exchanges have a growing appetite for tech stocks. Zomato, an Indian food delivery company, made a strong debut earlier in the year. Institutional investors have been very interested in Nykaa and PolicyBazaar Indian insurance aggregators, which both plan to list this month.
Paytm stated in its filing last week that it will deploy more than $250m of the capital it seeks to raise through the IPO. This money will be used to launch new initiatives and pursue acquisition opportunities. Its services compete with many others, such as WhatsApp Pay, WhatsApp Pay and PhonePe.