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Since Paytm IPO opens tomorrow, you know the risks and rewards before you sign up

Paytm’s parent company, One97 Communications Ltd. (OCL), plans to go public (IPO) 18,300 crore, which opens on November 8th. The price range is set at Rs 2,080-2,150 per share. Paytm’s initial public offering will be the largest major offering in India since Coal India Ltd’s share sale in 2010, following its successful initial public offering.

The IPO, which ends on November 10th, includes the issue of new shares valued at 8,300 crore and offer for sale (OFS) by existing shareholders in the amount of 10,000 crore.

“Even if reviews may seem expensive, Paytm has become synonymous with digital payment via mobile devices and is the market leader in the field of mobile payment. Patym is well positioned to benefit from the exponential 5x growth in mobile payments between FY2021 – FY2026 and therefore believes the ratings are justified. We encourage investors to SUBSCRIBE the issue, “said Jyoti Roy – DVP- Equity Strategist, Angel One.

One 97 communications (Paytm) is India’s leading digital ecosystem for consumers and retailers. It is the largest payment platform in India with a GMV of around 4 lakh crore in FY21. As of June 30, 2021, it will offer payment services, trading and cloud services and financial services to 33.7 million consumers and over 2.2 million merchants.

Choice Broking analysts have recommended long-term underwriting because of the great market opportunity, product and technology DNA, leadership and culture. However, it sees the rapidly changing technology and service landscape in the payment services sector, the risk of revenue concentration, declining operational efficiency and continued higher losses as the main risks and concerns.

Paytm plans to use the proceeds of the new issue to expand its businesses and attract new dealers and customers. The company skipped the pre-IPO financing round to expedite the start of its first stock sale.

Brokerage firm ICICI Securities has created extremely competitive markets with constantly evolving technology. Failure to attract merchants and volumes can be detrimental to business, reliance on payment services for the bulk of revenue as main risks and concerns.

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