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Fintech major Pine Labs, backed by Peak XV Partners and Temasek, has filed its draft red herring prospectus with SEBI to launch its much-anticipated IPO. The offering includes a fresh equity issue worth INR 2,600 crore and an offer for sale exceeding 14.78 crore shares by existing investors, including PayPal, Mastercard, and Actis. The company intends to use part of the proceeds to repay debt and invest in IT infrastructure, digital expansion, and subsidiaries abroad. A potential INR 520 crore pre-IPO placement may reduce the fresh issue size.
Noida-based fintech unicorn Pine Labs, supported by Temasek and Peak XV Partners, has taken a key step towards going public by filing its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi). The company is planning to raise funds through an initial public offering (IPO) comprising a fresh issue of equity shares totalling INR 2,600 crore along with an offer for sale (OFS) of over 14.78 crore shares by several investor-shareholders. Advertisement
The list of selling shareholders under the OFS includes prominent global and domestic investors such as Peak XV Partners, London-headquartered Actis, PayPal, Mastercard Asia/Pacific, Temasek via Macritchie Investments, Invesco, Madison India Capital, MW XO Digital Finance Fund Holdco, Lone Cascade LP, and co-founder Lokvir Kapoor. This planned divestment is part of a broader investor exit and liquidity strategy, marking a significant phase in Pine Labs' growth journey.
Pine Labs has also proposed a pre-IPO placement of shares aggregating INR 520 crore. Should this placement materialise, the size of the fresh issue will be proportionately reduced.
The fintech firm has detailed the intended utilisation of IPO proceeds in its DRHP. Approximately INR 870 crore will be allocated for repayment of outstanding borrowings. Another INR 760 crore is earmarked for investments in information technology assets, development of cloud infrastructure, tech innovation, and procurement of digital checkout systems.
A further INR 60 crore is planned to be invested in its international subsidiaries - Qwikcilver Singapore, Pine Payment Solutions in Malaysia, and Pine Labs UAE - to accelerate its global footprint. The remaining amount will support general corporate needs and potential unidentified inorganic acquisitions.
Pine Labs has carved a niche in India's digital commerce sector by enabling seamless payment and issuing solutions for merchants, brands, enterprises, and financial institutions. As of the financial year ending December 2024, the company facilitated gross transaction values worth INR 7,53,105 crore across 3.97 billion transactions. It served over 9.15 lakh merchants, 666 brands and enterprises, and collaborated with 164 financial institutions through its robust platform.
Citing data from Redseer, Pine Labs has emerged as one of the top five in-store digital platforms in India and is a key processor under the Bharat Bill Payment System framework in FY24. The company faces competition from domestic players like Paytm, Razorpay, Infibeam, PhonePe, and PayU, while internationally, it competes with global giants such as Shopify, Adyen, and Block.
For the same fiscal period, Pine Labs recorded revenue from operations amounting to INR 1,208.2 crore and a profit after tax of INR 26.14 crore. The company's shares are intended to be listed on both the BSE and NSE.
The IPO is being managed by a consortium of major investment banks, including Axis Capital, Morgan Stanley India, Citigroup Global Markets India, JP Morgan India, and Jefferies India. KFin Technologies has been appointed as the registrar to the issue.
Source - PTI
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