Bengaluru: Digital payments service provider MobiKwik has denied holding acquisition talks with Naspers-backed payment gateway PayU, and is instead eyeing a fresh fundraise, a company spokesperson told Mint without revealing names of investors.
A Times of India report on Tuesday said Gurgaon-based MobiKwik held discussions with PayU to sell off its payment gateway business ‘Zaakpay’ for $50-$60 million. The report quoted a PayU spokesperson who also denied being in talks with MobiKwik for any buyouts.
"MobiKwik continues to sustain rapid growth, has diversified into financial services - and as a result is the first Indian fintech company to breakeven at scale. Its key shareholders, including Bajaj Finance, Net1, and Sequoia, are supportive of MobiKwik’s strategy and success. MobiKwik and its wholly owned payment gateway subsidiary both are currently fundraising," a MobiKwik spokesperson added in an emailed response to Mint’s queries.
Founded in 2009 by Bipin Preet Singh and Taku, MobiKwik has raised four rounds of funding from investors, including Sequoia Capital, American Express and Net1, for close to $120 million. MobiKwik caters to over 107 million Indian users, three million merchants and 200 billers on its platform. It expects to enroll at least 10 million users by FY20, according to an earlier statement.
Reports of a buyout also come at a time when MobiKwik reportedly turned profitable at a unit level before deduction of taxes, depreciation , and amortization. A TechCrunch report last month said MobiKwik may report a profit after taxes by FY2020-21, with plans to go public within 4-5 years’ time. However, MobiKwik is yet to file its audited financials for FY2018-19.
MobiKwik, earlier, said it has clocked ₹500 crore revenue in the ongoing fiscal year, with targets ₹700 annual revenue by March 2020. According to a valuation report prepared by MobiKwik’s auditors in February 2019, accessed from the ministry of corporate affairs, the company’s enterprise valuation was pegged at ₹3,204.5 crore ($452 million) during FY19. The valuation report also projected MobiKwik to have a free cash flow of ₹481.03 core, along with an EBITDA of ₹678.65 crore for the financial year ended March 2019.