Update: MobiKwik IPO subscribed over 7X on day 1, retail demand soars over 28X

Fintech platform MobiKwik’s initial public offering (IPO) saw a huge demand among retail investors. The Gurugram-based company’s IPO has been fully subscribed within the first hour of opening.

As of 5:45 PM, the company has seen over 9,86,000 applications where retail investors subscribed 28.4 times while non-institutional investors (NIIs) followed with 9.47x subscriptions.

The company has already raised Rs 257.4 crore from anchor investors by issuing 92,25,807 shares to 21 funds at an issue price of Rs 279 per share on December 10. Government Pension Fund (Norges Fund), Eastspring Investments, Morgan Stanley, White Oak Capital, 360 One Asset, HDFC Mutual Fund (MF), Axis MF, SBI MF, and SBI General Insurance are among the anchor investors.

For context, MobiKwik filed its Red Herring Prospectus (RHP) with the Securities and Exchange Board of India (SEBI) on December 6, to raise Rs 572 crore via only a fresh issue of equity shares.

The company intends to utilize the IPO proceeds for several strategic purposes. While Rs 150 crore will fund the growth of its financial services business, Rs 135 crore million is allocated for its payments biz. The firm will invest Rs 107 crore towards research and development in data science, AI-ML, and product technology.

The IPO is priced between Rs 265 and Rs 279 per share, as stated in the Red Herring Prospectus. Investors can place bids for a minimum of one lot, comprising 53 shares, amounting to Rs 14,787. The IPO allocation is divided as follows: 75% is reserved for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), and 10% for retail investors.

MobiKwik’s IPO will close on the 13th. According to experts, its IPO is expected to be oversubscribed by over 50 times. The company’s GMP (grey market premium) is currently hovering around Rs 136, with a potential listing price of Rs 415, reflecting a 48.75% premium.

In Q1 FY25, MobiKwik reported revenue of Rs 342.2 crore, accompanied by a slight loss of Rs 6.6 crore for the quarter. The company demonstrated remarkable growth in FY24, achieving a 62% year-on-year increase in revenue, which rose from Rs 539 crore in FY23 to Rs 875 crore. Notably, MobiKwik ended FY24 on a high, posting a profit of Rs 14 crore.

Mobikwik is the second fintech from the Indian startup ecosystem to get listed on the bourses. In November 2021, SoftBank-backed Paytm became the first fintech to hit the stock exchange. The company’s stock has shown remarkable growth, reaching a 52-week high on December 5 while currently, it stands at Rs 954 a piece.