Mobikwik files for IPO for second time at Rs 700 crore

Mobikwik's careful IPO plans: Gurugram-based payments platform Mobikwik has refiled its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise Rs 700 crore for its initial public offering.

The company had filed for a Rs 1900-crore IPO in July 2021, and even received SEBI approval in October the same year. 

The company had abandoned its IPO plans on the back of weak market conditions and poor investor sentiment.

MobiKwik planned to raise Rs 1,900 crore comprising a fresh issue of shares of up to Rs 1,500 crore and an offer for sale of up to IRs 400 crore in 2022.

IPO Again

This time around, Mobikwik is looking at a pre-IPO placement of Rs 140 crore, which will further reduce its issue size if approved.  The fresh issue is lesser than the board resolution of ₹880 crore worth of fresh issue of equity shares through the public offering.

The issue is being managed by SBI Caps and DAM Capital.

The company joins Ola Electric and FirstCry in offering list. 2023 also saw new-age brand Mamaearth list on Indian exchanges.

Business so far

Source: Pexels

The Sequoia-backed unicorn reported its first-ever consolidated profit at Rs 3 crore in the first quarter ended June 30 last year.

For financial year 2023, the company’s revenue from operations rose to Rs 539 crore against Rs 527 crore for FY22.

Loss for the year decreased by 34.60 per cent from Rs 128 crore in the 2022 fiscal to Rs 84 crore in the 2023 fiscal.

Revenue from operations stood at Rs 381 crore and profit after tax stood at Rs 9 crore.

Budgeting the raise

Sharing a plan on its investments, the company said it plans to invest Rs 250 crore for funding growth in the financial services business, with Rs 135 crore in the payment services business and the same amount in investment in emerging technologies like artificial intelligence (AI), machine learning and data.

About Rs 70 crore will be used for capital expenditure for the payment devices business, and general corporate purposes, it added.

“Our management will also have the discretion over the specific activities that will be funded towards certain Objects. For instance, we intend to utilise Rs 100 crore from the Net Proceeds towards acquisition of new consumers and merchants on our platform," the draft filing stated.

DRHP Dive

The IPO, to be listed on BSE and NSE, has a face value of Rs 2 and is entirely a fresh issue of equity shares with no offer for sale component.

“The Issue is being made through the book-building process, wherein not less than 75 per cent of the issue shall be available for allocation on a proportionate basis to qualified institutional buyers, not more than 15 per cent of the issue shall be available for allocation to non-institutional investors, and not more than 10 per cent of the issue shall be available for allocation to retail individual bidders,” the financials of the issue read.

More about the unicorn

The company was founded in 2008 by husband-wife duo Bipin Preet Singh and Upasana Taku, who have a background in scalable technology and financial products.

The company’s offerings include online checkout, scan and pay, soundbox, card machine, and merchant cash advance. The company has a B2B payments subsidiary Zaakpay. The company has also received RBI approval for its Payment Aggregator (PA) business.
The company has acquired 1.8 crore new users every year between 2021 and 2023 September.

Mobikwik has over 14 crore registered users and has enabled close to 4 million merchants to conduct online and offline payments.