As there are numerous Indian firms that keep coming up on the IPO list. In this article, we will be talking about one such Indian payments firm, Prosus that is siad to be listed by Prosus, the Dutch investment firm that is controlled by the South Africa’s Nasper. Keep reading the article, till the end as we will be decoding more about the PayU platform and its listing.
What’s the News?
The Dutch investment firm that is controlled by the South Africa’s Naspers has gained massive benefits from the Swiggy’s latest IPO. It is said to have gained over $2 million on its investment in the food delivery giant. This has significantly impacted the Dutch investment firm, Prosus to list one of its subsidiaries, PayU which is a India focussed fintech subsidiary.
What was the Aim of Prosus Behind this?
If you keep close tabs on the news on stock markets and IPOs, then, you will probably be knowing that companies that aim to list companies have an aim behind their listings. Well, with this aim in mind, Prosus aims to make a valuation of $5-7 billion, however, the latest comments from the Prosus Chief Investment Officer Ervin Tu has suggested that the timeline will be changing.
Impact of Netherlands-Based PayU in India
When we talk about the Netherlands-based PayU, it has made quite a name for itself in the Indian market. Founded in 2002, this fintech has been dominating the Indian market for a while, but it has since faced some growing competition from other fintech players such as Razorpay and PhonePe. These competitors are backed by the likes of Tiger Global and Walmart, and they have also captured a dominant share of the domestic digital payments sector. Despite this fact, PayU has carved out a significant niche for itself by providing a payment solution and expanding it into lending services that will benefit both small businesses and consumers. As per a recent report, Its valuation is said to be raised to $4.2 million.
Decoding the Obstacles to Public Listing
One of the most significant obstacles to the PayU’s path in the public listing was a 15 month regulatory ban which has prevented the company from acquiring new merchants. The firm has resumed its growth trajectory earlier this year and has also received approval from the Reserve Bank of India (RBI) in April for operating as a payment aggregator and has expanded its merchant network.
This development has come during a time when the country’s digital payments sector has seen explosive growth in recent years! All credit goes to the country’s increased internet penetration and government initiatives such as Digital India, which is among the other factors.
The Growth Scale in 2024
In FY2024, the country has seen an annual growth of 44% in its retail digital transactions, with overall payment volumes rising by 20%. Additionally, these statistics have provided a perspective on why Prosus views India as a key market today. The investment firm’s portfolio also includes several Indian startups, which are online e-commerce marketplaces such as Meesho, and home service providers such as Urban Company, which is amongst the many investments in the country. As per a report, Prosus has acquired a stake of 31% in Swiggy.
Furthering Growth Scale for PayU
If you look at PayU, you will find that FinTech has a presence in 17 countries, and it has been gearing up for the same since it got its public listings last year. It is currently owned by the Naspers Group, and FY24 saw its revenue clock an annual growth of 11% – amounting to $444 million for the period – PayU has been working with financial advisers, which includes Goldman Sachs is instrumental in preparing itself for the IPO. It is also expected that it will be filing its Draft Red Herring Prospectus (DRHP) sometime early next year, with the IPO likely raising at least $500 million.
What Prosus CEO says?
Last year the CEO of Prosus has said that the he is exepecting for more of its Indian portfolio companies to go public in the next 12 to 18 months. It has acquired stakes in online marketplace Meesho along with Urban company as mentioned earlier.
Conclusion
With the PayU being listed in Prosus, it will be a milestone for Indian Fintech firms that are looking to scale and make revenue ten fold in the near future. That’s all folks. I hope the article will help you to get all the information you need.
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