The Netherlands-based PayU plans to ask for regulatory approval in February for an initial public offering worth at least $500 million in India, three people with direct knowledge said.
PayU, owned by South African conglomerate Prosus, is a payment gateway that also offers other services including buy-now-pay-later, and competes with the likes of Tiger Global-backed Razorpay and Walmart-owned PhonePe.
PayU has appointed Goldman Sachs, Morgan Stanley and Bank of America as advisors for the IPO, which it plans to list by the end of 2024, the sources said, declining to be named as the discussions are confidential.
It also plans to hire at least one Indian investment bank for the deal, the sources added.
PayU, Goldman and Bank of America declined to comment, while Morgan Stanley did not respond to a request for comment.
The IPO could value PayU at between $5 billion and $7 billion, the sources said.
With smartphone use booming, millions of Indians use digital payment services daily, and the market is set to more than triple to $10 trillion in 2026 from $3 trillion in 2022, according to a report by Boston Consulting Group and PhonePe.
PayU in June said its India revenue grew 31% to $399 million driven by growth in “enterprise and small and medium-sized businesses”. Last week, it promoted its India CEO Anirban Mukherjee to global chief executive.
PayU’s IPO could be one of India’s biggest fintech listings in recent years.
Softbank-backed Paytm, which offers digital payment and other lending services, raised $2.5 billion in a 2021 IPO, but saw its shares nosedive soon after amid valuation concerns.
Many Indian tech companies which were eyeing stock market debuts have in recent years faced scrutiny from bankers and investors, who have cast doubts about their sky-high valuations. A funding crunch has also hit many smaller startups in recent months.
Reuters