MobiKwik Files for $84 Million IPO

Indian digital payments firm MobiKwik has filed for an initial public offering (IPO) worth up to 7 billion rupees ($84 million).

This move comes after the company’s previous attempt in 2021 was postponed due to the lackluster market debut of its larger rival, Paytm, Reuters reported Friday (Jan. 5).

MobiKwik had initially filed for a 19 billion rupees ($230 million) IPO in July 2021, with plans to go public in November, according to the report. However, the company decided to delay its IPO following Paytm’s underwhelming performance.

Paytm’s shares tumbled 25% in its trading debut on the Bombay Stock Exchange. Its market cap at that time was roughly $13 billion, well below the expectations that were set going into the trading.

Since then, both Paytm’s fortunes and the Indian IPO market have rebounded, the Reuters report said. In 2023, companies raised 527.42 billion rupees ($6.35 billion) by going public on the National Stock Exchange.

In its recent filing with market regulators, MobiKwik stated that it is considering a pre-IPO placement to issue securities worth up to 1.4 billion rupees ($17 million), which would reduce the value of the IPO by an equivalent amount, per the report.

The company intends to issue only new shares in its IPO, with no current investors selling shares, according to the report. Bajaj Finance, Abu Dhabi Investment Authority and American Express hold stakes of 13.44%, 2.8% and 1.76% respectively in MobiKwik.

MobiKwik plans to allocate 1 billion rupees ($12 million) of the net proceeds towards customer and merchant acquisitions, while 1.35 billion rupees ($16 million) will be invested in data, machine learning (ML) and artificial intelligence (AI), the report said.

Founded in 2009, MobiKwik provides a mobile phone-based payment system and digital wallet, enabling customers to add money to an online wallet that can be used for payments.

The company reported a 2.5% increase in revenue to 5.39 billion rupees ($65 million) in fiscal 2023, according to the Reuters report. It also narrowed its losses from 1.28 billion rupees ($15 million) to 838.1 million rupees ($10.08 million).

As of Sept. 30, MobiKwik had 146.94 million registered users and approximately 3.81 million merchants, the report said.

The company has enlisted SBI Capital Markets and DAM Capital Advisors as book managers for the IPO, per the report.