Paytm IPO GMP, Risk factors, IPO schedule & Detailed review

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One97 communications/Paytm Details

One97 Communications, formerly known as Paytm, is one of the leading mobile payments and UPI platforms in the country. It is also one of the biggest startups in India. Paytm has a user base of about 350 million, out of which 50 million active users, 20 million registered merchant partners, and payments bank has 60 million accounts.

Paytm IPO opening on 8th Nov 2021 of ₹18300 crores via IPO that comprises fresh issue of ₹8300 crores and the offer for sale (OFS) of ₹10000.

What are the Risk factors in Paytm IPO

1. Paytm has a history of net losses with declining revenue, The company also expects further losses in the future.

2. Paytm have experienced negative cash flows in prior years

3. Paytm has Rs 52.20 Crore contingent liabilities, if materialized may harm the company

4. They are highly dependent on their payment services, any harm to it can cause harm to the whole company

5. In the future if payment processing charges payable to financial institutions and card networks increase significantly, the company may not be able to pass these higher charges to merchants or customers and the company may not be profitable

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What are the Competitive strengths in Paytm IPO

1. Paytm has built strong brand value over the years and also built trust among the users

2. Paytm is one of India’s leading digital payment service platforms.

3. Paytm has a brand value of US$6.3 billion.

4. Paytm has a huge customer base with a total of 333 million total customers

What are the Products and services offered by Paytm?

Services on the Paytm app are Recharge and Bill Payments, Send money (Money Transfer), Pay (In-Store Payments), Travel ticketing, Entertainment ticketing, Mini-apps Store, Games, Paytm First Subscription, Digital Banking (including Paytm Wallet, FASTag), Lending, Wealth Management, Insurance

Financial track record of Paytm

ParticularsFY19FY20FY21Qtr Ending 30-Jun-21
Total Assets87,668.01,03,031.091,513.094,590.0
Profit After Tax-42,309.0-29,424.0-17,010.0-3,819.0
Profit %-118.19%-83.10%-53.38%-40.28%
Amount in Millions

Objective behind IPO

1. Growing and strengthening of Paytm ecosystem, including through acquisition and retention of consumers and merchants and providing them with greater access to technology and financial services

2. Investing in new business initiatives, acquisitions, and strategic partnerships; and

3. General corporate purposes.

Paytm IPO GMP today

As of 9th Nov 2021, The grey market premium is Rs 80

Paytm IPO is overpriced or underpriced?

As the company is reporting negative EPS consistently over the past years the P.E is not possible to compute.

Hence, It is hard to say whether it is over or underpriced

Paytm IPO open date & close date

Open date: 08-Nov-21, Close date: 10-Nov-21

Paytm IPO IPO Finalization of Allotment, refund date & listing Date

Allotment date: 15-Nov-21, Refund date: 16-Nov-21, Listing date: 18-Nov-21

Paytm IPO check allotment

Paytm IPO allotment can be checked through their registrar

Paytm IPO reveiw

Paytm has a good brand value and strong customer base, but still, its revenue and net profit are consistently decreasing and the company also expects further losses in the near future

So, Investment in a loss-making company is not a good option but looking at its IPO craze and brand value it may give listing gains.

Rating: 3 out of 5.
Disclaimer: I am not SEBI registered, Kindly do your own research before any decision, my views are for educational purpose only


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