IT Correspondent
Mumbai, Nov 23:
After disastrous trading debut of its ambitious initial public offers (IPO), the shares of the “One 97 Communications Ltd”, the parent company of “Paytm”, continued to plummet at stock exchange on Monday.
While on Thursday, Nov 18, the shares tumbled over 27 per cent from the issue price of Rs 2,150, it tumbled 13.39 per cent to Rs 1,351.75 on National Stock Exchange and declined 13.66 per cent to Rs 1,350.35 on Bombay Stock Exchange (BSE) on Monday, generating criticism against the company.
Paytm launched the largest public issue in India, raising Rs 18,300 crore that comprised a fresh issue of Rs 8,300 crore and an offer for sale of Rs 10,000 crore by several shareholders, including the founder and investors. This was greater than Coal India’s Rs 15,000 crore offer a decade back.
Paytm, Founder and Chief Executive Vijay Shekhar Sharma made clear that he wanted Paytm to surpass the long-standing IPO record set by Coal India Ltd. in 2010. Incorporated in 2000, One 97 Communications is India’s leading digital ecosystem for consumers and merchants.
A steep fall in Paytm share sale was in sharp contrast to some of the recent stock market debuts by biggies from the start-up world. Nykaa, Zomato and Policybazaar all saw their stock price gain significant ground on the day they made their entry on the stock market platform. Incidentally, these also saw a huge response to their IPOs. But this was not the case with Paytm whose public issue was subscribed a mere 1.89 times.
As per financial details for October 2021, released by Paytm, the gross merchandise value rose 131% to Rs.832 billion for the month and loan disbursals increased more than 400 per cent to Rs.6.27 billion.
Sharma defended the company’s prospects and rallied Paytm employees during a four-hour town hall business meeting on Monday and encouraged them to look past the first-day drop. He advised them not to read too much into criticism.
Headquartered at Noida (Uttar Pradesh), it has regional offices at Bangalore (Karnataka), Gurgaon (Haryana), New Delhi and Greater Noida. It also has sub offices in Chennai, Mumbai and Kolkata.
In the meanwhile market regulator Securities Exchange Board of India (SEBI) which had given its approval for the biggest Indian IPO on October 22, 2021, is likely to quiz investment bankers on Paytm’s listing fiasco.