Have you ever explored ways to apply for an IPO much before it is available in the trade market? Paytm Money, the wealth management arm of Paytm, is trying to capitalise on the excitement created by IPO bound startups in India.
Adding a new feature, Paytm Money now allows users to apply for IPO before the actual IPO of any company opens in the market. The feature is designed to attract lakhs of millennials and young investors who can’t track market movements every day or don’t trade actively due to their other commitments.
With the Paytm Money pre IPO feature, the company is expecting to strengthen its market presence and accelerate the acquisition of users who are willing to dive into the stock trading by investing in upcoming IPOs.
Paytm Money Pre IPO Feature: Big Picture
- Anyone can participate in the IPO of any company without worrying about the trading time or day.
- Generally, an early investor gets a short window of 3 days to apply for an upcoming IPO in advance, and that too during select hours.
- By having freedom from the time limit, retail investors can apply for an IPO 24×7 on days when pre-open IPO is enabled.
- Paytm Money system records the order and triggers it the moment market is open. It increases the chances for investors who are willing to cash in on the opening price offerings of companies, especially startups.
- Paytm Money has enabled this feature for Zomato – the food tech unicorn that is set to debut on Indian stock market on 14th July 2021.
- The Paytm Money pre-IPO feature has already recorded thousands of orders for the Zomato IPO.
- In India, trading hours clash with office hours which happen to be the busiest session of the day. By having flexibility in terms of time and days, people can now look at the market to study the IPO bound companies and apply for the same as per their convenient time and day.
Food For Thought
After SEBI eased out norms for listing a company in the stock market, many Indian startup unicorns have started gearing up for IPOs. Zomato being the first one, Ola, Paytm, Policy Bazaar, Nykaa, Delhivery, Flipkart, Freshworks and many more are reportedly putting things in place that are required to get themselves listed in the stock market. It has created a sudden IPO rush among millennials and investors who missed the bus of investing in these startups at the seed or angel investment stage.
Be it eCommerce or online food delivery, Indian startup unicorns have, so far, managed to scratch the surface of the market. Just to put things in perspective, retail eCommerce sales in India is estimated to reach $145 billion by 2026, accounting for just 10.3% of the country’s total retail market. There is an enormous opportunity for these startups to grow to a significant stage in the years to come as a large chunk of the market remains untapped.
Still, investing in such startups that are burning millions of dollars in customer acquisition and recording losses much more than their revenue is quite tricky. Paytm Money Pre-IPO feature could bring you a fortune but only if it is used in conjunction with a thorough analysis of the market potential of each startup that you are willing to invest in.