Mobikwik Refiles Draft Papers with IPO Size Cut Down to Rs 700 Crore

Payment platform One MobiKwik Systems Ltd has decided to slash its initial public offering (IPO) size from Rs 1,900 crore to Rs 700 crore and has refiled the draft papers with the Securities Exchange Board of India (SEBI) in its quest to raise funds from the public.

This strategic move marks a significant reduction in the company’s fundraising target, which was initially announced in July 2021 when Mobikwik filed the draft red-herring prospectus with SEBI for a Rs 1,900-crore IPO.

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The revised IPO will consist solely of a fresh issue of shares. However, the company, in consultation with its lead managers, is also considering issuing securities worth Rs 140 crore through pre-IPO placement, potentially lowering the size of the fresh issue.

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Of the funds raised, Rs 135 crore will be allocated to fuel the growth of financial services, another Rs 135 crore will support investments in data and technology, Rs 70.28 crore will be earmarked for capital expenditure on payment devices, and the remaining portion will be utilized for general corporate needs.

Co-founded by Bipin Preet Singh and Upasana Taku, Mobikwik leverages their expertise in scalable technology and finance to promote financial inclusion in India through technological means. The company offers a wide range of payment solutions, including online checkout, Kwik QR scan, MobiKwik Vibe, EDC Machine, and Merchant Cash Advance to businesses and merchants.

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Mobikwik’s subsidiary, Zaakpay, operates a B2B payment gateway and holds approval from the Reserve Bank of India (RBI) for payment aggregator (PA) business. The flagship Mobikwik app provides users with access to digital credit, investments, and insurance and has gained approximately 18.29 million users annually between 2021 and 2023.

As of September 30, 2023, Mobikwik boasted 146.94 million registered users and supported 3.81 million merchants for online and offline payments. The company saw a 32.33 percent increase in Payment Gross Merchandise Volume (GMV), and MobiKwik ZIP GMV surged by an impressive 354.86 percent from Fiscal 2021 to Fiscal 2023.

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A recent RedSeer report praised the company’s cost-effective, tech-driven growth strategy and efficient employee cost-to-revenue ratio for Fiscal 2023. Mobikwik’s revenue also witnessed an increase, reaching Rs 539.47 crore in Fiscal 2022–23, up from Rs 526.56 crore in Fiscal 2021–22, while losses decreased by 34.60 percent to Rs 83.81 crore in Fiscal 2023.

The IPO will be led by SBI Capital Markets Limited and DAM Capital Advisors Limited, further solidifying the company’s plans to raise funds and continue its growth trajectory in the fintech sector.

Also Read: Upcoming IPO in India

Investors and stakeholders are closely watching Mobikwik’s developments, given its prominent position in India’s digital payments and financial services landscape.

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