New Delhi: After record-high levels of IPO activity in 2021, volatile market conditions have resulted in a significant slowdown during the first quarter of 2022. In Q1 2022, the Indian market introduced 16 IPOs vs 23 IPOs in Q1 2021, according to the EY Global IPO Trends Q1 2022. During Q1 2022, proceeds raised through the main markets equated to $ 995m via three main market IPOs compared to US$ 2.57 bn during Q1 2021, which is a decline of 60 per cent in proceeds raised and a decline of 82 per cent in the number of deals. SME segment raised US$ 17.46m via 13 IPOs during Q1 2022.Nobin Paul has composed music and background score for the movie. The sudden reversal can be attributed to a range of issues, both emerging and residual. These include the rise in geopolitical tensions; stock market volatility; price correction in over-valued stocks from recent IPOs; growing concerns about a rise in the commodity and energy prices; the impact of inflation and potential interest rate hikes; as well as the Covid-19 pandemic risk continuing to hold back full economic recovery.The three largest IPOs in terms of proceeds were Adani Wilmar, Vedant Fashions and AGS Transact Technologies, with consumer products &amp; retail being the most active sector followed by the diversified industrial products. On the findings of the report, Sandip Khetan, Partner and Financial Accounting Advisory Services Leader, EY India, said, "The IPO momentum of a blockbuster 2021 has not carried over to 2022 so far. Issuance and proceeds are well off last year's pace, as geopolitical uncertainty along with other macro factors continues to affect investor sentiment. That said, we are witnessing the largest IPO (of LIC) in Indian capital markets and the successful closure of other recent IPOs. The backlog of IPOs could lead to a strong upswing in volumes if volatility does moderate and earnings are robust."However, in line with continued regulatory developments aimed at enhancing disclosures and market practices, there have been several recent amendments such as a change in disclosures for objects of the issue, revised norms for credit rating agencies (monitoring proceeds), revised norms for price band (wherein now 5 per cent cap is to be maintained between the floor price and upper price). In addition, SEBI issued a consultation paper on 'Basis of Issue Price' covering additional parameters, e.g., Key Performance Indicators (KPIs) to be disclosed, particularly for loss-making companies basis for arriving at the issue price.The EY report also highlights that there is a strong pipeline for IPOs in Q2 2022 and beyond. More than 20 companies have filed their DRHPs in Q1 of 2022, planning to raise funds in the current calendar year. These include a mix of traditional companies with long track records as well as newer age companies across various sectors such as consumer, pharmaceuticals, technology, logistics and financial services. In line with the sharp decline in global IPO activity, there was a considerable fall in cross-border, unicorn, mega (proceeds above US$1b) and SPAC IPOs. There were also several IPO launches postponed due to market uncertainty and instability. On a broader note, EY findings suggest witnessing a robust activity in the private market with more than 10 companies gaining Unicorn status in Q1 2022. PE/VC investments in 2022 continue good momentum, with Jan-Feb 2022 investments (US$10.3bn) being more than twice that of Jan-Feb 2021 (US$4.1bn) but 7.6 per cent lesser than the previous two-month period November-December 2021.—IANS

After record-high levels of IPO activity in 2021, volatile market conditions have resulted in a significant slowdown during the first quarter of 2022.

Indian IPO market experienced significant slowdown

After record-high levels of IPO activity in 2021, volatile market conditions have resulted in a significant slowdown during the first quarter of 2022.



New Delhi: &nbsp;Fintech companies in the Asia-Pacific (APAC) region raised $3.33 billion over 186 deals in the first quarter (Q1) of 2022, dominated once again by India-based fintechs, a new report said on Monday.Geographically, India-based fintechs dominated funding in APAC, accounting for 42 per cent and 34 per cent of total deal value and volume, respectively, in the region.According to S&amp;P Global Market Intelligence, fintech companies based in APAC surpassed previous deal values and volumes observed in the March quarter over the past three years.Compared to Q1 2021, the figure reflects a 44 per cent increase in deal value and 23 per cent growth in deal volume. However, compared to the previous quarter, the Q1 funding levels represent a 26 per cent decline in dollar amount raised and 9.7 per cent dip in number of deals. "While the year-over-year record-high funding levels in the first quarter seemingly paint a rosy picture of the fundraising environment for Asia-Pacific fintechs, the decline in funding value and volume on a sequential basis signal otherwise and is perhaps more indicative of what lies ahead," said Celeste Goh, Research Analyst at S&amp;P Global Market Intelligence.Fintech fundraising activity could see a further slowdown in subsequent periods in the wake of an underwhelming public equity market and further rate hikes.Digital lenders, the fintech segment that was hardest-hit by the pandemic, appear to be back in action, topping all other fintech categories with $1.28 billion raised across 52 deals, the report said. "Several established fintechs continue to see fresh funding from new investors, and their persistent inclination for inorganic growth in this uncertain climate seems to suggest confidence in their ability to raise more capital," said Goh.—IANS

Fintech companies in the Asia-Pacific (APAC) region raised $3.33 billion over 186 deals in the first quarter (Q1) of 2022, dominated once again by India-based fintechs, a new report said on Monday.

India-based fintechs continue to dominate funding in Asia-Pacific

Mumbai:&nbsp;India’s largest state-owned bank, State Bank of India (SBI) reported a marginal fall in net profit of 6.70 per cent year-on-year to Rs 6,068 crore on back of fall in operating profit.On sequential basis, the net profit fell 33.42 per cent. In the similar period last year, the bank had reported a net profit of Rs 6,504 crore and in previous quarter it reported a net profit of Rs 9,114 crore.The operating profit of the bank fell sharply by 32.79 per cent on-year to Rs 12,753 crore during the quarter under review. The bank reported operating profit of Rs 18,975 crore in the same period last year.The net interest income of the bank increased by 12.87 per cent on-year to Rs 31,196 crore in the current quarter. And domestic net interest margin rose 8 basis points to 3.23 per cent.Gross advances of the bank showed a good growth 14.93 per cent driven by retail personal advances, out of which home loans grew by 13.77 per cent. In absolute terms, the bank reported a gross advances of Rs 29 lakh crore, as against Rs 25 lakh crore in the same quarter last year.Corporate loan book grew by 10.57 per cent, SME and Agri loans have also registered 10.01 per cent and 9.82 per cent on-year growth, respectively.Deposit grew 8.73 per cent to Rs 40 lakh crore. CASA ratio of the bank fell 64 basis points to 45.33 per cent as on June 30. Wholesale bank deposit rises 8.73 per cent on-year.On asset quality front, the gross non-performing assets (NPA) ratio of the bank fell sharply by 141 basis points on-year to 3.91 per cent, and net NPA by 77 basis points on-year to 1.00 per cent. The slippage ratio for the Q1FY23 stood at 1.38 per cent, seen an improvement of 109 basis points on-year.Capital adequacy ratio as at the end of Q1FY23 stood at 13.43 per cent.—IANS

India’s largest state-owned bank, State Bank of India (SBI) reported a marginal fall in net profit of 6.70 per cent year-on-year to Rs 6,068 crore on back of fall in operating profit.

SBI PAT fall 6.70% on-year to Rs 6,068 cr in Q1FY23

New Delhi: Leading digital payments and financial services company&nbsp;<a href="https://www.business-standard.com/topic/paytm" rel="noopener noreferrer" target="_blank" style="color: rgb(37, 145, 220);">Paytm</a>&nbsp;has received positive feedback from top&nbsp;<a href="https://www.business-standard.com/topic/brokerages" rel="noopener noreferrer" target="_blank" style="color: rgb(37, 145, 220);">brokerages</a>&nbsp;such as Goldman Sachs, JP Morgan, Morgan Stanley, ICICI Securities, Yes Securities and CLSA after reporting its Q1FY23 financial results.In their brokerage notes, they highlighted Paytm's strong growth in revenue and contribution margins during the quarter in addition to sharp improvement in net payment margins.In its note,&nbsp;<a href="https://www.business-standard.com/topic/goldman-sachs" rel="noopener noreferrer" target="_blank" style="color: rgb(37, 145, 220);">Goldman Sachs</a>&nbsp;said that the company "remains firmly on the path to profitability" following its Q1FY23 results.The brokerage also raised its EBITDA estimates for&nbsp;<a href="https://www.business-standard.com/topic/paytm" rel="noopener noreferrer" target="_blank" style="color: rgb(37, 145, 220);">Paytm</a>&nbsp;and believes that Patytm's Q1FY23 results should "help provide more visibility to investors" on the company's profitability target."We believe Paytm's 1QFY23 results should help provide more visibility to investors on the company's path to profitability (adjusted EBITDA improved 25 per cent q-o-q and was 14 per cent better vs GSe), and we view this as a key catalyst for the stock. Revenue growth at 89 per cent YoY in 1QFY23 remains elevated, and while we expect a deceleration in growth in subsequent quarters, we forecast a robust 37 per cent FY22-25E revenue CAGR for Paytm, at the higher end of global fintech peers," the brokerage firm elabolated.<a href="https://www.business-standard.com/topic/goldman-sachs" rel="noopener noreferrer" target="_blank" style="color: rgb(37, 145, 220);">Goldman Sachs</a>&nbsp;maintains its 'Buy' rating for the stock with a revised target price of Rs 1,100.JP Morgan also welcomed Paytm's Q1FY23 financial results, citing sharp revenue growth (over 89 per cent y-o-y and 9 per cent q-o-q) and contribution margin (43 per cent +830bps q/q).It said the sharp margin improvement was driven by a reduction in payment processing charges resulting in expansion of payments business profitability (35 per cent gross margin, 10bps net MDR)."The contribution margin print in 1Q is what we had assumed to happen in late F24/25. Incremental contribution margin in the business is running at 60 per cent (on YY basis) suggesting further improvement ahead," the brokerage added.Analysts at JP Morgan also highlighted lower processing costs for the quarter, which have driven payment margin improvement.The brokerage said that Paytm's financial services business remains strong andA revenue growth in this segment at 60 per cent (q-o-q) "is tracking ahead of expectations and seen in continued traction for the company's loan syndication business".The brokerage maintains its aOverweight' rating for the stock with a target price of Rs 1,000.ICICI Securities said that&nbsp;<a href="https://www.business-standard.com/topic/paytm" rel="noopener noreferrer" target="_blank" style="color: rgb(37, 145, 220);">Paytm</a>&nbsp;continues to improve its margins, with losses coming down sequentially.The brokerage said that the company's Q1FY23 results was characterised by: A) reduction in payment processing charges leading to improvement in net payment rates; B) continued acceleration in lending business with disbursements of Rs 56 billion; C) enhanced contribution/adjusted-EBITDA (before ESOP cost) margins due to increased net payment rates and rising contribution of financial services revenue; D) sustained growth in monthly transacting users (MTUs) and deployment of offline devices and strong QoQ growth in gross merchandise value (GMV).The brokerage continued to maintain its 'Buy' rating for the stock with a target price of Rs 1,285.Yes Securities said in its brokerage report that it acknowledges improvement in Paytm's trajectory after the company's Q1FY23 financial results. Some of the factors that led to this improvement include strong growth in revenue from operations and significant improvement in contribution profit.While the brokerage said it "awaits delivery and sustenance of profitability", it highlighted that the company continues to show improvement with strong growth in payments services revenue, net payments margin and contribution margin.With this, the brokerage has now upgraded its rating for the Paytm stock to 'Neutral' with a target price of Rs 850.Morgan Stanley said that Paytm registered another strong quarter with revenue growth in Q1FY23 at almost 90 per cent y-o-y, led by better than expected take rates in both payments and financial services.The brokerage noted that the key highlight during the quarter was sharp improvement in contribution margin, which increased to 43 per cent of revenues in comparison to 35 per cent in Q4FY2022.The brokerage has increased its target price for the Paytm stock to Rs 785 with an equal-weight rating.CLSA summed up Paytm's results by saying that the company put up a "good show" during the quarter.In its note, the brokerage said Paytm's Q1FY23 was a "continuation of prior quarter trends" with healthy GMV growth, while cross-selling of merchant devices and loan distribution "remains the key focus and incremental driver of EBITDA breakeven"."Most P&amp;L numbers were largely in line with our expectations, while payment processing costs were significantly lower. This led to 13 bp net take-rate in 2QFY23 itself, while we were expecting it to happen in FY24," it added.The brokerage has increased the target price of the Paytm stock to Rs 650.Paytm started the new fiscal year with 89 per cent (year-on-year) revenue growth in Q1FY23 at Rs 1,680 crore, while EBITDA (before ESOP) loss reduced to Rs 275 crore, marking an improvement of Rs 93 crore (on-quarter).The company's contribution profit grew 197 per cent Y-o-Y to Rs 726 crore, leading to an increase in contribution margin to 43 per cent of revenues in comparison to 35 per cent in Q4FY22.Its user engagement, measured by monthly transacting users (MTU), grew 49 per cent (on-year) to 74.8 million during the quarter, while the total devices deployed increased to 3.8 million (2.8 million added in the past 12 months).Paytm's payments services revenue grew by 69 per cent y-o-y, while revenue from financial services grew 393 per cent y-o-y during the quarter, led by massive growth in Paytma¿s loan distribution business.During the quarter, Paytm disbursed 8.5 million loans, representing a growth of 492 per cent Y-o-Y and 30 per cent Q-o-Q.The value of the loans disbursed stood at Rs 5,554 crore, marking a growth of 779 per cent Y-o-Y or 56 per cent Q-o-Q.Moreover, the company has now reached an annualized run rate of approximately Rs 24,000 crore of loan disbursements through its platform, with significant upside potential from increasing penetration.—IANS

Leading digital payments and financial services company Paytm has received positive feedback from top brokerages such as Goldman Sachs, JP Morgan, Morgan Stanley, ICICI Securities, Yes Securities and CLSA after reporting its Q1FY23 financial results.

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Indian IPO market experienced significant slowdown

Sunil Aswal

The Hawk

Tag : Q1

Indian IPO market experienced significant slowdown

Sunil Aswal

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India-based fintechs continue to dominate funding in ...

SBI PAT fall 6.70% on-year to Rs 6,068 cr in Q1FY23

Top brokerages welcome Paytm's strong Q1 results, r ...