Mobikwik enters unicorn club at $1.5 $-1.7 billion valuation

Digital payments firm Mobikwik has entered the unicorn club weeks ahead of its IPO. It becomes the 33rd Indian startup to hit a $1 billion valuation this year.

Sources privy to the development said that Mobikwik's valuation touched $1 billion after a secondary sale of shares held by employees under the Employee Stock Options (ESOP) plan. The fintech startup is likely to list on the stock exchange ahead of Diwali at a valuation of $1.5-1.7 billion.

"Several MobiKwik employees exercised their ESOPs in a recently opened ESOP window by selling a part of their shares in a secondary sale. The secondary round was led by ex-Blackstone India Head Mathew Cyriac who topped up his holding at almost double the previous price," sources said.

Mobikwik has seen a significant valuation jump since its last funding round (Series G) when it was valued at $720 million. Under its ESOP 2014 programme, the Gurgaon-based company had reserved 4.5 million equity shares or 7 percent of its equity. In a prior statement, Mobikwik said that it has made 20 percent of these grants availale to the employees at the time of filing its Draft Red Herring prospectus (DRHP).

Earlier in June, when the company raised funds from Abu Dhabi Investment Authority, its shares were priced at Rs 895.8 apiece.

Mobikwik said in its SEBI filing that it plans to raise Rs 1,900 crore (255 million) during its IPO, including an offer for sale of upto Rs 400 crore and a Rs 1500-crore primary issue of shares. The shareholders who would be participating in the OFS include American Express, Bajaj Finance co-founders, Mobikwik Co-founders Bipin Preet Singh and Upasana Taku, Sequoia Capital, Teeline Asia, and Cisco Systems.

The startup, which was founded almost a decade ago as a mobile wallet, later expanded to offer a bouquet of financial services, including small-ticket loans, BNPL, insurance offerings, and more. Mobikwik's total income for the financial year ended March 31, 2021 was down by 18 percent to Rs 302 crore, while its losses increased 12 percent to Rs 111 crore.

The platform's userbase has expanded to 101 million; Mobikwik has also onboarded over 3 million merchants for both online/ offline payments.