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What’s New in the IPO World: Devyani International, PayTM, Ola, and More

Following food search and delivery platform Zomato’s listing debut last week, a Quick Service Restaurant (QSR) player is looking to list themselves – Devyani International (DIL). This follows in the wake of Burger King and Barbeque Nation’s listing eight months ago. DIL, owned by RJ Corp, had filed for the IPO to raise ₹1,400 crores in May this year. Finally, last week, it got Sebi’s nod. RJ Corp is already among the world’s largest bottlers for PepsiCo and its bottling business has already been listed under Varun Beverages.

Since the pandemic first started, deliveries have been the driving force for food services companies. The revival of outdoor dining services is dependent on unlocking and easing curbs in bars and restaurants. That being said, the post-second-wave turnaround and market liquidity have led to a lifting of investor spirits. Zomato’s IPO is a case in point. The company opened with a massive oversubscription last Friday. This is interesting because this sets the stage for local start-ups to push forward their own listing plans in the process. Digital payments company Paytm, hospitality chain Oyo and cab ride-hailing company Ola are among the new-age Indian start-ups ready to list on the stock exchanges.

Paytm, though, will largely remain foreign-owned. Its major investors are SoftBank, Elevation Capital, Alibaba, and Ant Group. Despite this, One97 Communications, Paytm’s parent company, has filed a draft red-herring prospectus with Sebi to raise Rs 16,600 crores. This will be the biggest Indian initial public offering (IPO) in at least a decade. What’s interesting is that Zomato’s oversubscribed offering clocked over one million mandates on the Unified Payments Interface (UPI). This bodes well for Paytm, who said that out of everyone who subscribed to Zomato’s IPO, 27% were less than 25 years old, while 60% were less than 30 years old. Mobikwick, too, another digital payments platform, filed its draft red herring prospectus to raise up to Rs 1,900 crore through a public issue. 

Ola, on the other hand, announced today that it is expanding its ESOP to Rs 3,000 crores. It is offering employees an additional Rs 400 crore in stocks before its IPO. The ride-hailing sector had pulled in around 78 million rides in March 2021, according to reports from Red Seer. This is 69% of pre-Covid-19 levels in 2019! These are exciting times indeed for the IPO sector. 

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