Indian payments firm MobiKwik files for smaller $84 million IPO

BENGALURU (Reuters) – Indian digital payments firm MobiKwik, backed by Abu Dhabi Investment Authority and Bajaj Finance, has filed for an initial public offering (IPO) worth up to 7 billion rupees ($84 million), about 63% less than its first attempt in 2021.

The company, founded over a decade ago, had filed for a 19 billion rupees IPO in July 2021 with plans to go public in November. However, it shelved those plans after the dismal market debut of larger rival Paytm late that year.

However, both Paytm’s fortunes and the Indian IPO market’s fortunes have since recovered. Last year, companies raised 527.42 billion rupees by going public on the National Stock Exchange, per exchange data.

MobiKwik said, in papers filed with market regulators on Thursday, that it is considering issuing securities worth up to 1.4 billion rupees in a pre-IPO placement that if undertaken, will lower the value of the IPO by an equivalent amount.

The company said it plans to only issue new shares in its IPO and that no current investor will sell shares. Bajaj Finance, wealth fund Abu Dhabi Investment Authority and American Express hold stakes of 13.44%, 2.8% and 1.76%, respectively, in the company.

It plans to use 1 billion rupees of the net proceeds on customer and merchant acquisitions and invest 1.35 billion rupees in data, machine learning and artificial intelligence.

MobiKwik’s revenue rose 2.5% to 5.39 billion rupees in fiscal 2023, while its loss narrowed to 838.1 million rupees from 1.28 billion rupees.

The company said it had 146.94 million registered users and around 3.81 million merchants as of Sept. 30, 2023.

Mobikwik has hired SBI Capital Markets and DAM Capital Advisors as book managers for the IPO. ($1 = 83.1593 Indian rupees)

(Reporting by Ashish Chandra in Bengaluru; Editing by Savio D’Souza)