A Revolution in Making By: Sriram Rathi

Paytm:

Paytm (a partial abbreviation for "pay through mobile") is an Indian multinational technology business established in New Delhi, India, that specializes in digital payment systems, e-commerce, and financial services. Paytm is currently available in 11 Indian languages and offers online services such as mobile recharges, utility bill payments, travel, movie, and event bookings, as well as in-store payments using the Paytm QR code at grocery stores, fruits and vegetable shops, restaurants, parking, tolls, pharmacies, and educational institutions.

2019-2020:

Paytm raised $1 billion in a fundraising round led by T Rowe Price, along with previous investors Ant Financial and SoftBank Vision Fund, on November 25, 2019. During the COVID-19 pandemic, Tata Starbucks joined with Paytm in July 2020, allowing customers to order food online.

2021:

To conduct its first public offering, One97 Communications submitted a draught red herring prospectus with the Securities and Exchange Board of India in July 2021. (IPO). It went public in November 2021, raising Rs 18,300 crore (US$2.4 billion) at a US$20 billion valuation. It was India's largest initial public offering (IPO). The shares began trading on the NSE on November 18, 2021, at 1,950, 9.3% below the upper band of the IPO price range, and closed down more than 27% at 1,560, the largest decrease on a listing day in Indian IPO history.

In the beginning of December 2021, One97 Communications, the largest ever initial public offering (IPO) on Dalal Street, went public. However, the situation has altered dramatically since then, with even analysts affiliated with the company's merchant bankers issuing targets much below the IPO price. People underestimated the compounding impact that this platform's consumer base has. On 19 of January 2022, the BSE finished at Rs 1,081.45 a share, down 3.41% from the previous close. Paytm's market capitalization has dropped to $9.49 billion as of 19 January 2022, from a height of $16 billion on the private market. Macquarie, a brokerage group, lowered Paytm's parent's target price to Rs 900 from Rs 1,200 on Monday. When compared to the issue price of Rs 2,150, this was a 58% discount. If the merchant services it provides are included, quarterly income from payments has reached $140 million, and revenue is forecast to climb 50% to 60% year over year. After only three years in business, the company currently processes more loans than Bajaj Finance, which has been in business for 30-32 years. They can be benchmarked against just one guy in the credit business, and that is Bajaj (Finance). We (Paytm) should be looked at for the scale we offer in terms of total loans, loan value, and loan quality.

Opinion of Investors:

Rakesh Jhunjhunwala claims that he can make more money than other industries such as metals and banks. Rakesh Jhunjhunwala raised concern about new-age IT companies' valuations rather than their business models. Jhunjhunwala, when asked about new-age tech businesses throughout the world and their influence on Wall Street, claimed that Indian companies have yet to demonstrate such supremacy. Furthermore, he stated that American internet companies have built up their capital over a lengthy period of time, such as Amazon's 25-year journey to this point.

Some investors are calling for Uday Kotak's head after the dramatic drop in Paytm shares during the last two trading sessions. Mr. Shah, please get your facts straight, wrote Uday Kotak in a tweet. Paytm was not led by Kotak. Zomato was led managed by Kotak at an issue price of 76 (current market price of 150), and Nyika was led managed by Kotak at an issue price of 1125. (Current market price Rs.2100). Paytm's stock has continued to plummet. The stock fell 12.74%, or Rs (-) 198.80, to Rs 1,362.00 at the end of the trading session on November 22.

Conclusion:

Paytm Karo is a phrase that many Indians have heard and an action that has been performed by over 330 million customers and 21 million traders. What began as a wallet has grown into a suite of payments and trading apps, and is now transforming into a financial marketplace that provides credit and a variety of services ranging from investments to insurance. With digital payments expected to expand from $ 20 trillion in 2021 to between $ 40 trillion and $ 50 trillion by 2026, Paytm has a lot of room to develop. Paytm is certainly a success story to watch and learn from. However, this does not mean that Paytm's initial public offering (IPO) is a viable investment opportunity. The two topics are vastly different.