Snapdeal, a SoftBank-backed Indian eCommerce platform, has filed for an initial public offering (IPO), following several other companies in the country that have joined the capital market.
Many popular names such as digital payment platform Paytm, beauty e-commerce retailer Nykaa and food delivery platform Zomato have filed a listing in India this year as the stock market reached new highs with ample liquidity and strong retail participation.
According to the IPO draft prospectus (DRHP), Snapdeal’s IPO consists of a fresh issue of shares worth $165.09 million and an offer for sale of 30.8 million shares. Following the IPO, Softbank, Snapdeal’s major investor, will reduce its stake in the company from 34 percent to 24 percent.
The online eCommerce platform offers products ranging from mobile phones, televisions, gaming consoles, fashion accessories, appliances, beauty products, and much more.
The New Delhi-headquartered company, founded by Wharton alumnus Mr. Kunal Bahl and Indian Institute of Technology, Delhi graduate Mr. Rohit Bansal in 2010, rivals with big names in the Indian eCommerce market such as Walmart-owned Flipkart and Amazon.
According to reports, Unicommerce, Snapdeal’s fully owned subsidiary, has also raised investment from Softbank for around 30 percent share ahead of the IPO.
Snapdeal potentially faces strong competition from Reliance Industries, a multinational conglomerate company that is rapidly expanding in the online market. As per the filing, Snapdeal aims to deploy the funds from the IPO to support organic growth initiatives.
The company said that 75 percent of the issue will be reserved for Qualified Institutional Buyers (QIB) while 10 percent is for retail investors and the remaining 15 percent is booked for Non-Institutional Investors (NII).