Exterior view of PayTM office in Noida, Uttar Pradesh, on the outskirts of New Delhi, India
Courtesy: Anindito Mukherjee via Getty Images

Paytm IPO Day 2: Total subscription was 35%, with retail portion fully booked

Paytm’s Rs 18,300 crore IPO was subscribed 35 percent at 12:45 pm on the second day of the offering, according to statistics released by the stock exchange.

Exterior view of PayTM office in Noida, Uttar Pradesh, on the outskirts of New Delhi, India
Courtesy: Anindito Mukherjee via Getty Images

Meanwhile, the portion of Paytm shares allocated for retail investors was fully subscribed, with 90,01,254 bids received for 87,98,076 shares allotted for retail individual investors. The portion earmarked for Qualified Institutional Buyers (QIBs), comprising include investors such as foreign investors, financial institutions, and banks, was subscribed at 29 percent, while the number of shares reserved for Non-Institutional Investors was subscribed at 3 percent.

Paytm is offering shares at a price range of Rs 2,080-2,150 each share, and retail investors can bid for as few as one lot of six shares and as much as 15 lots. At the top of the price band, one lot of Paytm shares will cost Rs 12,900. Paytm allotted shares worth Rs 8,235 crore to more than 100 institutional investors, in India’s largest anchor round on November 3 including the Singapore government, ahead of the country’s largest stock market listing. The anchor round was ten times oversubscribed.

Paytm’s IPO comprises an Rs 8,300 crore primary issue and a Rs 10,000 crore offer for sale (OFS) by the company’s existing shareholders. Besides Paytm’s managing director and CEO Vijay Shekhar Sharma, major investors selling their stakes in the IPO including Japanese conglomerate SoftBank, China’s Ant Group, and Alibaba, alongside Elevation Capital.

At the end of Day 1, the Rs 18,300 IPO was already subscribed to 18 percent or 0.18 times. This largest initial public offering (IPO) in India’s history will close on Wednesday (November 10).

Although retail investors showed some interest in the fintech giant’s initial public offering, overall demand slipped below that of other tech-backed unicorn IPOs. Zomato, a food-tech company, and Nykaa, an online lifestyle marketplace, both experienced oversubscription on the first day of their offerings. This could possibly be due to the size of Paytm’s IPO.

Paytm’s IPO is projected to be the largest in the country’s corporate history, smashing the previous record made by Coal India Ltd, which raised more than Rs 15,000 crore more than a decade ago. According to market analysts, Paytm’s equity premium has dropped in the grey market, with a GMP of roughly Rs 58 today. On November 18, 2021, the company’s shares are planned to be listed on the BSE and NSE, two major stock exchanges.

Paytm seeks to use the funds of the fresh issuance to strengthen its business lines and attract new merchants and customers. The Noida-based digital payment firm decided to skip the pre-IPO funding round to accelerate the initial share sale.

Paytm IPO Day 1: Total subscription was 18%, with retail portion booked at 78%