India1 Payments IPO : 7 things to know about

India1 Payments Ltd, was formerly known as BTI Payments. The company had filed for its IPO in September 2021 and the draft red herring prospectus (DRHP) of India1 Payments Ltd had been approved by SEBI in November 2021.

However, post the listing performance of Paytm and a slew of other digital IPOs, India1 Payments Ltd has chosen to wait in the side lines for the markets to become more robust. Its IPO is most likely to be now announced in the new fiscal year after the pressure of the LIC IPO is done and dusted.

7 important things to know about India1 Payments Ltd IPO

1) India1 Payments Ltd has filed for IPO which will be a combination of a fresh issue of shares plus an offer for sale (OFS) by the early investors and partially by the promoters. The company was formerly called BTI Payments and operates in the arena of digital payment systems enabling.

Like many other IPOs in the anvil, the company is waiting with the SEBI approval for an appropriate time to launch the IPO, which is most likely to happen in the new fiscal year only.

2) The India1 Payments Ltd IPO  will comprise of a fresh issuance of Rs.150 crore and an offer for sale (OFS) of 1,03,05,180 shares (1.03 crore shares approximately). Let us focus on the OFS portion first.

Among the major investor groups tendering their shares in the OFS are India Advantage Fund S3 offering 49.94 lakh shares, India Advantage Fund S4 offering 24.86 lakh shares, Dynamic India Fund offering 2.16 lakh shares, BTI Payments Group offering up to 25 lakh shares and Banktech group offering up to 1 lakh shares.

The total value of the OFS portion will only be known once the price band is fixed for the issue, which will be closer to the IPO opening date.

3) The Rs.150 crore fresh issue portion will be used largely to defray the existing debt of India1 Payments Ltd. In addition, the funds will also be utilized by the company for bankrolling its capital expenditure plans including the setting up of ATMs across India. Some funds are also likely to be allocated for general corporate purposes.

4) Meanwhile, India1 Payments Ltd is also planning a pre-IPO placement of shares to the tune of Rs.30 crore to key investors including QIBs, HNIs and family offices.

The pre-IPO offer is different from the anchor placement in that the pre-IPO offer has greater leeway to fix the pricing of the placement but it also entails a longer lock-in period as compared to the anchor placement.

The anchor placement is normally done a day before the opening of the IPO. IF the pre-IPO placement is successful, then the overall size of the issue will be reduced to that extent.

5) India1 Payments Ltd is promoted by the Banktech group in the year 2006. Later in 2013, ICICI Ventures had invested in the company.

India1 Payments Ltd is headquartered in the silicon capital of Bengaluru and it is a leading non-bank ATM operator in India. As of the time of filing the DRHP and as per details disclosed in the prospectus filed, the company operates a network of 8,520 ATMs across India covering over 14 states and Union Territories in India. 

6) India1 Payments Ltd  largely operates on a fee based model and operates under the well-known brand of India1ATM, which is found in most parts of the country. Its operations are largely in the semi-urban and rural segments where it becomes logistically difficult for banks to run and operate ATMs.

In fact, as per last count, nearly 90% of the total ATMs operated by India1 Payments Ltd are located in rural and semi-urban areas. In such cases, outsourcing the task to India1 Payments Ltd becomes a much easier and economical task. That is an interesting business model, although it is getting competitive at this point of time.

7) The IPO of India1 Payments Ltd will be lead managed by JM Financial, IIFL Securities and Edelweiss Financial Services. They will act as the book running lead managers or BRLMs to the issue.

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