Payments firm Mobikwik gets Indian regulator’s approval for $253m IPO

REUTERS/Danish Siddiqui - RTS8IIZ

Payments firm One MobiKwik Systems Ltd has received markets regulator Securities and Exchange Board of India’s approval for its 1,900 crore initial public offering (IPO), a person aware of the development told Mint.

With Sebi’s approval in hand, the company can look to launch its IPO as early as the end of this month or early next month, the person cited above said.

A Mobikwik spokesperson could not be immediately reached for comments.

Mobikwik had filed its draft IPO papers with Sebi in July.

The MobiKwik IPO comprises a sale of 1,500 crore worth of new shares and an offer for sale of stock worth 400 crore by its promoters and shareholders.

Tech startups such as MobiKwik are rushing to take advantage of the positive sentiment created by a record-breaking rally in the equity markets, burgeoning public interest in technology shares and accelerated adoption of online services in the past year because of the pandemic.

Among MobiKwik’s shareholders participating in the offer for sale are, American Express Travel Related Services, which plans to sell shares worth 9.98 crore, Bajaj Finance ( 68.98 crore), Sequoia Capital ( 95 crore), Cisco Systems ( 11.48 crore), Tree Line Asia Master Fund Pte ( 24.41 crore) and MobiKwik co-founders Bipin Preet Singh ( 113.33 crore) and Upasana Taku ( 78.82 crore).

Singh and Taku hold 20.21% and 14.31% in the company, respectively. Bajaj Finance owns 13.86%, while Sequoia Capital India Investment has 13.46%.

In its draft IPO documents, MobiKwik said 40% of the net proceeds will be used to fund organic growth initiatives, “including customer and merchant acquisition and retention, investment in data-sciences, products and technology, enhancement of the user and merchant experience on our platform, providing cash-collateral to buy-now, pay-later lending partners”.

It also plans to use the proceeds to apply for additional licence approvals and authorisations that will require it to maintain minimum capitalisation and net-worth requirements.

The Gurgaon-based firm said it will continue to seek attractive inorganic opportunities that fit well with its strategic business objectives and growth strategies, and the amount of net proceeds to be used for acquisitions will be based on its management’s decision.

For fiscal 2021, the firm reported a total income of 302.26 crore, up from 369.85 crore a year ago. Net loss for the period widened to 111.30 crore from 99.92 crore in the previous year.

Mobikwik’s business is divided in three segments – buy now, pay later; consumer payments (MobiKwik Wallet); and payment gateway (Zaakpay).

Its buy now, pay later products — MobiKwik Zip and Zip EMI — provide accessible and affordable small-ticket credit to middle-class Indians. It also cross-sells small-ticket wealth and insurance products to these users.

As of March 2021, its merchant base in India totalled more than 3.44 million. It has more than 101.37 million registered users.

The article was first published on livemint.com.

Singapore Reporter/s

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Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.