Mobikwik IPO Day 3: Strong Investor Interest and Promising Prospects
The initial public offering (IPO) of One MobiKwik Systems has garnered significant attention from investors, reflecting a robust demand for shares in the fintech sector. The ₹572 crore book-built issue, which consists entirely of a fresh issue of 2.05 crore shares, opened for subscription on Wednesday, December 11, and is set to conclude on Friday, December 13. By the end of the second day of subscription, the IPO had already been subscribed 20.41 times, indicating a strong appetite among investors.
Mobikwik IPO GMP
As per market sources, the latest grey market premium (GMP) for the Mobikwik IPO stands at ₹158. With the upper price band of the issue set at ₹279, the estimated listing price of Mobikwik shares is projected to be ₹437, reflecting a premium of nearly 57%. This positive sentiment in the grey market suggests that investors are optimistic about the company’s future performance.
Mobikwik IPO Subscription Status
Data from the Bombay Stock Exchange (BSE) reveals that both retail and non-institutional investors (NIIs) have shown considerable interest in the IPO. By 4:20 PM on Friday, the Mobikwik IPO had been subscribed 118.72 times, with bids for 1,40,94,26,986 shares against the 1,18,71,696 shares offered. The retail segment alone was subscribed 131.36 times, while the NII segment saw a subscription of 108.73 times. Qualified institutional buyers (QIBs) also participated actively, with a subscription rate of 119.50 times.
On the second day of subscription, the overall subscription had reached 20.41 times, with bids for 24,23,45,574 shares against the 1,18,71,696 shares available. The retail segment was particularly strong, subscribed 64.65 times, while the NII and QIB segments were booked 30.07 times and 0.84 times, respectively.
Mobikwik IPO Details
The IPO is priced between ₹265 and ₹279 per equity share, with the company aiming to raise ₹572 crore through this public issue. The funds raised are intended for business expansion and investments in data, machine learning (ML), artificial intelligence (AI), and technology.
Investors can apply in lots, with one lot comprising 53 shares of the company. This means the minimum investment for retail investors is ₹14,787. SBI Capital Markets and DAM Capital Advisors are the lead managers for the public issue, while Link Intime India Private Limited serves as the official registrar.
The share allotment is expected to be finalized on Saturday, December 14, with a potential delay announcement on December 16. The shares are anticipated to list on the BSE and NSE on December 18.
Mobikwik IPO Review
MobiKwik is a prominent player in the fintech landscape, offering prepaid digital wallets and online payment services. Analysts from Geojit Financial Services noted that by May 2024, Mobikwik had captured a 23.11% market share in the prepaid payment instruments (PPI) wallet segment by gross transaction value, making it the largest wallet provider in India. The company boasts a vast reach, covering 99% of India’s pin codes.
SBI Securities highlighted Mobikwik’s significant role in the mobile wallet and digital lending space, addressing a substantial untapped market of over 40 crore individuals in India who lack access to financial products due to limited or no credit history. The company has demonstrated a revenue compound annual growth rate (CAGR) of 29% from FY22 to FY24 and has achieved profitability at both the EBITDA and PAT levels in FY24.
Should You Apply?
Experts are generally optimistic about the IPO’s long-term prospects, citing reasonable valuations and healthy growth potential. Geojit Financial Services has assigned a "subscribe" rating to the issue, emphasizing its strong brand recall, diversified offerings, and promising industry outlook. At the upper price band of ₹279, Mobikwik’s market capitalization to sales ratio stands at 2.5 times based on FY24 financials, which analysts consider reasonably priced.
Bajaj Broking also recommends subscribing to the issue for long-term gains, noting the company’s significant growth potential. According to a RedSeer Report, traditional market players currently serve only a fraction of the affluent population, leaving a vast untapped market of over 500 million individuals in India who require access to financial products. This presents a considerable opportunity for Mobikwik to leverage payment data and facilitate smaller loans, thereby enhancing financial inclusion.
In conclusion, the Mobikwik IPO is shaping up to be a noteworthy event in the fintech sector, with strong investor interest and promising growth prospects. As always, potential investors are advised to consult certified experts before making any investment decisions.