Paytm debacle: Big IPO fails in the past decade
One 97 Communications Ltd, Paytm’s parent company, listed at around 9% discount at ₹1,955 against its issue price of ₹2,150 on the bourses
Digital payments major, Paytm had a rather disappointing stock market debut on Thursday. One 97 Communications Ltd, Paytm’s parent company, listed at around 9% discount at ₹1,955 against its issue price of ₹2,150 on the BSE and National Stock Exchange (NSE) and clocked as much as 27% loss during afternoon trading.
That’s not all. Paytm’s share touched the lower circuit, the minimum price to which a stock is allowed to fall, in the second half of the day. As opposed to the $20 billion valuation that Paytm was aiming for, its current valuation stands significantly lower at around $16 billion.
Looking at IPOs of companies with issue size above ₹1,000 crore in the last 10 years, Paytm’s IPO, country’s largest ever, saw the biggest crash on the listing day with a margin of nearly 10% from the next worst performer.
In November 2015, Cafe Coffee Day’s parent company Coffee Day Enterprises’ stock had shrunk over 17% from its issue price on its listing day. In 2008, Reliance Power too started its stock market journey with a nearly 17% fall from its issue price of ₹10,123.
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