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Summary
- Indian digital payments provider Paytm is planning for a public debut.
- In it, the enterprise reportedly seeks to raise a capital of about Rs 16,600 crore (US$ 2.2 billion).
- Paytm is backed by big players like the Ant Group and Softbank.
Indian digital payments provider Paytm is planning for a public debut, in which it seeks to raise a capital of about Rs 16,600 crore (US$ 2.2 billion).
Officially known as One97 Communications Ltd, Paytm is backed by big players like the Ant Group and Softbank. The digital payment services company plans to sell new shares worth Rs 8,300 crore, while existing investors like Softbank and Berkshire Hathaway are expected to offer shares of the same value at the initial public offering (IPO).
In the prospectus filed with the Securities and Exchange Board of India (SEBI), Paytm reported that it plans use Rs 4,300 crore for customer growth and merchant acquisition, and Rs 2,000 crore for new initiatives and acquisitions.
Paytm's entry into the stock market world is said to be India's biggest public debut so far, beating the previous record held by Coal India that had raised Rs 15,000 crore over a decade ago.
Paytm is said to be in talks with JPMorgan Chase, Morgan Stanley, HDFC Bank, Goldman Sachs and others for advising on the IPO.
Should you invest in Paytm?
In fiscal year 2020-21, Paytm narrowed its loss to Rs 1,704 crore from that of Rs 2,943.32 crore in fiscal 2019-20.
However, in terms of total revenues, the digital payment service provider recorded a 10 per cent year-over-year (YoY) decline, amounting to Rs 3,186 crore, in FY21.
According to a Grand View Research report, the market size of the fintech sector was valued at around US$ 58.3 billion in 2020. Estimates suggest that this industry could register a compound annual growth rate of 19.4 per cent to expand between 2021-2028.
So, there is a chance that digital payment services providers might grow in future.
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How can Canadians invest in Paytm?
Investors planning to buy foreign stocks can explore a variety of options. One way would be to find the right online trading platform of a brokerage company or the right stockbroker who has access to global stocks.
Trading in international stocks is considered to be a great way to diversify one’s investment portfolio as it can help during downturns in Canadian equity markets.
