Paytm IPO is a main-board IPO of equity shares of the face value of ₹1 aggregating up to ₹16,600.00 Crores. The Paytm IPO open and close dates are not available as of now. Link Intime India Private Ltd is the registrar for the IPO. The shares are proposed to be listed on BSE, NSE.

One 97 Communications Ltd, founded in 2000, is India’s leading digital ecosystem for both consumers and merchants. As of March 31, 2021, the company had 333 million+ clients and 21 million+ registered merchants to whom it provided payment, financial, commerce, and cloud services.

Industry Overview

Evolving Digital landscape in India

With a Gross Domestic Product, of approximately US$2.7 trillion in 2020, India is the sixth-largest economy according
to the World Economic Outlook database. Post COVID-19, India is on a strong recovery track, and the country’s GDP growth rate is projected at approximately 9% per annum in real terms during 2020-2025, the highest among the larger economy leading to India becoming a US$ 4.2 trillion economy by 2025. In 2020, Government announced a special COVID-19 relief economic package of ~US$ 270 billion to revive the Indian economy and industrial sector. As per the Centre for Economics and Business Research (“CEBR”), India is expected to become the third-largest economy in the world by 2030.

Technology is playing an important role by increasing reach and accessibility for merchants and consumers. The revolution of mobile and cloud technology, combined with growing incomes and higher consumption rates in India, is at a digital tipping point. Over the last decade, India added 500 million+ new smartphone users.

With higher affordability, reducing smartphone costs, and availability of a greater variety of value smartphones, the number of smartphone users is expected to reach 800-850 million in FY 2026, representing more than 55% of total
population and 80% of internet users.

In FY 2021, 650 – 700 million Indians had access to the internet and the number is expected to increase to over 950-
1,000 million by FY 2026 representing more than 70% of the total population, this is primarily driven by increasing
smartphone penetration, reducing data cost, new technology innovations and Government’s push towards digitization.
As per TRAI, the data usage per data subscriber rose to 141 GB in 2020 from 3 GB in 2014 whereas, data cost declined
from INR 269 / GB to INR 10.9/ GB in 2020.

Evolution of Indian Payment System

The Indian payment system has evolved significantly since 1980. For a long time, cheque clearing systems dominated
the payment landscape in India.

Digital payments have been growing steadily over time, however, India continues to be a cash-driven economy. In FY
2021, the digital payments market size by value stood at approximately US$ 20 trillion with 43 billion transactions during the year. Consumers are rapidly switching to digital payments as it provides simple, safe and convenient ways to transfer money across accounts. Similarly, for merchants, acceptance of payments in digital form has increased significantly.

Mobile payments
Mobile payments are modes of payment using mobile phones, this typically includes mobile wallets and UPI. There
are various ways in which payment can be done using mobile. Money transfer between consumers and merchants using wallets or UPI is becoming highly ubiquitous in India and has led to a surge in mobile payments over the last few years. Mobile payments increased approximately 16 times from 1.6 billion in FY 2017 to 26 billion in FY 2021. Mobile payments expected to reach ~ US$ 3.1 trillion by value by FY 2026

Payment Gateways and Payment Aggregators
Payment Gateways and Payment Aggregators allow e-commerce businesses to process transactions on their website/
app. They allow payment acceptance through credit/debit cards, net banking, e-wallets, and UPI. A payment
aggregator facilitates only payments by connecting merchants with payment acquirers. Paytm is the largest payment
gateway aggregator in India based on total transactions, for the fiscal year ended March 31, 2021, with the widest
ecosystem of payment instruments.

Company Overview

In 2009, the company launched the first digital mobile payment platform, “Paytm App,” to provide customers with cashless payment services. According to the Kantar BrandZ India 2020 Report, it has now become India’s largest payment platform and the most valuable payments brand, with a total brand value of US$6.3 billion.

Paytm is India’s Leading Ecosystem for Consumers and Merchants. Paytm has the widest selection of payments, commerce, and financial services. With the increased acceptance of digital payments, more companies have started offering digital payment solutions. Paytm is the most integrated player with a presence across various payment formats.

Paytm offer consumers a wide variety of payment instruments, which include (i) major third-party instruments, such
as debit and credit cards and net banking, and (ii) Paytm Payment Instruments including wallet, postpaid amongst
other instruments. In addition, Paytm provides merchants with various products enabling them to accept payments
digitally through Paytm Payment instruments and major third-party instruments.

Customers can use the app to make cashless purchases in stores, top-up mobile phones, send money online, pay bills, access digital banking services, buy tickets, play games online, buy insurance, and invest, among other things. Merchants, on the other hand, can use the platform for advertising, online payment solutions, offering products to customers, and loyalty solutions.

Company help merchants to grow their business by giving them solutions that allow them to accept payments, acquire and retain consumers, improve their business operations and access financial services. Merchants can use in-store and online payment solutions to accept payments through Paytm Payment Instruments as well as major third-party payment methods.

To help them acquire and retain customers, and create demand, company offer them services like selling tickets to customers, advertising, mini-app listings, channel and loyalty solutions. In addition to helping merchant ecosystem facilitate more commerce, company also provide software and cloud services that allow large, medium and small merchants to improve their business operations and access important financial tools such as banking, wealth and credit facilities.

Paytm ecosystem serves 333 million consumers and over 21 million merchants as of March 31, 2021. The payments
platform is at the core of our ecosystem. Making payments (bill payments, in-store or money transfer) is, in most
cases, the first use case for a consumer on Paytm.

Company’s main offerings are

  • products and services across “payment services”,
  • “commerce and cloud services”
  • “financial services”

The products and services are carefully developed to address large markets, and in areas where the consumers and merchants are underserved.

Payment services

Company have a full suite of payment services for both consumers and merchants which enables them to make and
receive payments in a convenient, seamless and secure manner both online and in-store.

Payments products and services for consumers (Paytm Payment Instruments) and for merchants (“Merchant Acquiring”).

Commerce and Cloud Services

The commerce and cloud services offerings provides a lifestyle destination for consumers to avail lifestyle commerce services such as ticketing, travel, entertainment, gaming, food delivery, ride hailing and more. Easy access to such services within the Paytm App environment, through native offerings or through mini-apps partners, plays a critical role in user engagement and retention, and enhances the brand.

Financial Services

Financial Services is a set of innovative financial inclusion offerings including mobile banking, lending, insurance, and wealth management for consumers and merchants. Since most of the financial services businesses were launched recently between 2019 and 2021, financial services contributed a relatively small percentage of the revenue.

Competitive Advantages

  • Strong ecosystem that allows to address large market opportunities.
  • India’s leading digital payment service platform.
  • Trusted brand identity with a brand value of US$6.3 billion.
  • Large customer base with 333 million total customers, 114 million annual transacting users, and 21 million registered merchants.
  • Paytm Super-app to access a wide range of digital payment services over mobile phones.

Promoters and Financials

Paytm is a professionally managed company with no visible promoters.

IPO Details

(to be updated)

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