Mumbai, India—India’s biggest-ever initial public offering opened Monday with digital payments platform Paytm looking to raise nearly $2.5 billion, in what has already been a record year for share listings.
Paytm is backed by Chinese tycoon Jack Ma’s Ant Group, Japan’s SoftBank, and Warren Buffett’s Berkshire Hathaway, which together own around a third of the company.
The firm was founded barely a decade ago by Vijay Shekhar Sharma, the son of a schoolteacher who says he learned English by listening to rock music.
He was ranked India’s youngest dollar billionaire four years ago at the age of 38 and now has a net worth of $2.4 billion, according to Forbes. He owns a nearly 14-percent stake.
Paytm was issuing fresh shares worth 83 billion rupees ($1.1 billion), with existing shareholders selling stocks worth $1.34 billion, according to the prospectus.
The IPO is expected to make Paytm India’s most valuable tech company with a valuation of $20 billion, up 25 percent from two years ago.
The platform was launched in 2010 and quickly became synonymous with digital payments in a country traditionally dominated by cash transactions.
It has benefited from the government’s efforts to curb the use of cash—including the demonetization of nearly all banknotes in circulation five years ago—and most recently, from COVID.
“I didn’t know corona would happen but Paytm was very useful to me during the pandemic,” Mumbai grocery shop owner Naina Thakur told AFP.
Thakur said about a third of her customers pay her for milk, bread, and other daily groceries via Paytm.
“It’s much easier than a bank transfer because they only need my mobile number to pay and I get the settlement within seven hours,” she said.
Thakur is one of nearly 22 million Indian shop owners, taxi and rickshaw drivers, and other vendors who accept payments as low as 10 rupees ($0.13) using Paytm’s ubiquitous blue-and-white QR code stickers.
The platform had 337 million customers at the end of June, according to the company’s regulatory filing. In 2020-21 it undertook transactions worth more than $54 billion.
The number of mobile payments in India has skyrocketed, accounting for 26 billion transactions in the 2020-21 financial year.
Mumbai-based financial analysis firm Motilal Oswal estimates mobile digital payments will cross $3.1 trillion in value by 2026.
Foreign giants have also sought to grab a piece of the pie including Google and Amazon. Another major player is PhonePe, owned by Flipkart in which US retail giant Walmart owns a majority stake.
