IPO Note : One MobiKwik Systems Ltd By Nirmal Bang Ltd
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Background
One Mobikwik Systems Limited, co-founded by Bipin Preet Singh and Upasana Taku, leverages scalable technology to promote financial inclusion in India. Operating a two-sided payments network, it serves 16.1 Cr users and 0.43 Cr merchants as of June 30, 2024. Its offerings span payments, digital credit, investments, and insurance, driving profitability with a Rs.14.1 Cr profit in FY24. Mobikwik’s Payment GMV grew at a CAGR of 46% and ZIP GMV at 112% (FY22–24), supported by products like UPI, ZIP credit, and Lens for personalized investment insights. The company also empowers merchants with solutions like QR payments, soundboxes, and cash advances.
Objects and Details of the Issue:
The public issue consists of fresh issue up to Rs 572 Cr. Company proposes to utilize the Net Proceeds towards: -
* Funding organic growth in financial services business – 150 Cr,
* Funding organic growth in payment services business – 135 Cr,
* R&D in data, ML and AI and product and technology – 107 Cr,
* Capital expenditure for payment devices business – 70 Cr.
Investment Rationale:
* Creating Positive and Sustainable Consumer Journeys
* Expanding a Low-Cost, Engaged Consumer Base
* Technology-Driven Innovation
* Strategic Scaling of Existing Products
* Expanding and Diversifying the Product Portfolio
* Driving Profitable Growth
Valuation and Recommendation:-
One Mobikwik Systems Limited is well-positioned in India’s fintech sector with scalable operations, profitability, and strong consumer loyalty, reflected in its low CAC of Rs.32.87 and 90.3% repeat usage rate. The company reported Rs.875 Cr in revenue and Rs.14 Cr net profit in FY24, with a 4.2% EBITDA margin, highlighting operational efficiency compared to peers like Paytm. Mobikwik stands out with a 24% PPI wallet market share, With an attractive valuation at 2.3x EV/Sales the company is well-positioned for future growth. We recommend a Subscribe rating for the IPO based on its profitability, scalability, and strong brand presence.
Please refer disclaimer at https://www.nirmalbang.com/disclaimer.aspx
SEBI Registration number is INH000001766
