Warren Buffett investment in Paytm shares: The steep fall in the shares of India’s largest IPO Paytm is proving to be a costly lesson for the early investors of the company. Since its listing on November 18, Paytm’s shares have lost nearly 58 per cent so far. The valuation of its parent company One97 Communications Ltd. has come down from $20 billion to $7.8 billion.
Buffett’s Berkshire Hathaway Inc. invested in 2018
According to a report in the Economic Times, people with knowledge of the development said that SoftBank Group Corp. had invested in the Indian company in 2017 at a valuation of around $7 billion. He said Berkshire Hathaway Inc. invested in the One 97 at a valuation of over $10 billion in 2018 and T. Rowe Price Group Inc. invested $16 billion in the next year. Invested in it at the valuation of Rs.
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The company lost Rs 4.74 billion in July-September
Paytm is struggling to convince its investors and analysts about the capabilities of the digital payments giant’s business model. Amid rising expenses, the company’s loss widened to Rs 4.74 billion ($63 million) during the July-September quarter. The fall in its shares amid a sell-off in global equities has also affected the prospects of tech companies that are preparing to launch an IPO in the Indian market. More than 40 percent of the companies that sold shares for the first time in India last year are under pressure.
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A Paytm representative declined to comment on an email sent regarding the valuation of SoftBank and Ant Group’s stake. The company’s stock was trading at Rs 917.60 (12.15 pm) on Monday with a gain of about 1.60 per cent. Jacma’s Ant is the largest shareholder of Paytm with a 25 per cent stake.
SoftBank and T. Rowe Price declined to comment, while Berkshire Hathe and Ant did not respond.
Paytm raised $2.5 billion from IPO
Paytm raised $2.5 billion through its IPO. Paytm’s stock market debut was the worst performance by a major tech company since the dot com bubble era of the 1990s. According to the offer document, the one-year lock-in of pre-IPO investors expires in November. Paytm provides digital loan, insurance, wealth management and stockbroking services.
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