Discussion in 'Technical Analysis' started by bishandixit, Nov 6, 2021.
Whether we should apply for Paytm
I am not applying for the IPO. The allocation is based on lottery and it seldom works for me. I prefer to buy good companies after a month or two after they get listed. It also means the IPO euphoria subsides considerably.
Further I did some research and for me PayTM as a whole is an avoid. I am not able to understand what they do.
A digital wallet - Compete with GPay
Payments bank - Not sure what it is but compete with HDFC Bank
E-commerce company - Compete with Amazon
Fantasy sports - Compete with Dream11
Mutual funds? Stockbroking? Insurance? Gold? - Yet another app
So I will like them to first decide what they are and possibly invest then.
Moreover, I prefer to invest in midcap companies that will become large cap. For me the PayTM pricing is such that it is already a large cap company. Pricing the IPO between ₹2,080–₹2,150 per share. And that puts the valuation at about $20 billion (₹1,49,000 crores) — 70x its operating revenue of ₹2,109 crores (as of March 2021)
I am also not able to understand if there is any moat for the company now with UPI payments. Everyone can have a payment system. Google, WhatsApp, Amazon to name a few.
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