Securities and Exchange Board of India (SEBI) has approved Rs 166 billion initial public offering (IPO) of One97 Communications, the parent company of Paytm. The company is expected to list in November.
As part of its IPO, One97 Communications intends to raise Rs 83 billion through a fresh issue of equity shares and another Rs 83 billon through the offer-for-sale (OFS) route.
It will be the largest IPO after the Rs 159.9 billion IPO of Coal India in 2010 and the Rs 166 billion IPO of Reliance Power in 2008.
Existing shareholders, including ANT Group and employees, will sell a stake in the OFS category. SoftBank, Elevation Capital, SAIF Partners, Berkshire Hathaway, and Ratan Tata’s RNT Associates are also listed as selling shareholders under the OFS.
Given the size of the offering, the success of the IPO would depend on the support it receives from international investors. The company is looking at a valuation of $20-22 billion. In the event the company is able to get this valuation, it will be in the same league as Tata Steel or Tata Motors, which have valuations of around Rs 1.6 trillion each. Bankers estimate that the IPO could result in foreign capital inflows of over $2 billion.
