Never said we are deferring our IPO plans: Pine Labs CEO B Amrish Rau

'Central bank digital currency (CBDC) and Digital Rupee open up exciting opportunities and if implemented correctly'

At a time when a growing number of technology firms have halted their expansion plans, financial technology unicorn Pine Labs is making new bets and is in expansion mode, says B AMRISH RAU, chief executive officer of Pine Labs, in conversation with Peerzada Abrar. The Noida-based merchant commerce platform, valued at over $5 billion, is now accepting the digital rupee at its point-of-sale terminals. If implemented correctly, the digital rupee can accelerate the migration from paper-based currency to digital. Excerpts:

According to a media report, you are deferring initial public offering (IPO) plans.

I never said we are deferring or delaying our IPO plans. I have no qualms saying that if a company has investors for more than 10-12 years, there will be an IPO at some point in time. Right now, the IPO window is shut.

Our responsibility right now is to continue building and scaling up. We have to work on our growth areas and our earnings before interest, tax, depreciation, and amortisation (Ebitda) position.

How do you view the macroeconomic (macro) uncertainty?

Most of the investing world is highly affected, (including) the global liquidity space. Clearly because of where the global liquidity is at, some investors are re-evaluating valuations and the timing of investment.

The way we have built our company over the years, I don’t think we have gone ahead of our core intrinsic value. We’ve continued to build a solid business which has inherent value and investors for a longer period.

What has been the impact of the macro uncertainty on your business or even raising funds?

There’s a difference between what’s happening in the valuation world and in the economy. A large portion of our revenue comes from the Indian market. With our economy (India) continuing to grow at over 6 per cent and digital payments growing even quicker, we are not seeing any slowdown across product lines.

Raising funds is not like (increasing) revenue. If we have raised $1.1 billion, we have enough money on the balance sheet and don’t need to raise more.

What are the bets Pine Labs is making?

We continue to deliver all kinds of payment technologies to offline merchants. The Reserve Bank of India (RBI) is keen on ensuring that the central bank digital currency (CBDC) gets accepted at merchant outlets.

Our responsibility is to bring in all kinds of payment technologies and deliver them to the merchant and consumer. What the RBI has put together in terms of CBDC is revolutionary. Our responsibility is to ensure merchants have the option to accept CBDC.

That’s why we partnered ICICI Bank to do these pilot projects in the market. We have invested heavily in the online payment stack Plural and are in a position of processing nearly Rs 8,000 crore of volumes on the online payment side. This, as a business (for us), didn’t exist 15 months ago.

But there are challenges for CBDC volumes to pick up and most customers feel they are comfortable with the Unified Payment Interface (UPI). How do you view those challenges?

There were these sorts of comments when UPI was launched. Over time, we have been able to see that both the Indian consumer and the merchant are adept at testing new payment types. Of course, we’ll have to see how CBDC progresses.

What are Pine Labs’ expansion plans?

We are continuing to maintain staff strength. We are investing to take our products and services to global emerging markets because we think our products and services are world-class. We acquired a company called Mosambee; its product stack is in the West Asian markets. We also have our instalment payment services in Southeast Asia.

We want to expand globally with our products and services. We are keen to grow our online payments portfolio in the next few years. We have also made four/five acquisitions.

How do you see the company’s revenue and profitability strategy?

We will want to continue to grow at about 40 per cent on the revenue side, higher on the Ebitda side, on a year-on-year basis. We got nearly Rs 1,600 crore of net revenue in our business in 2022-23. I don’t see any issues for growth in 2023-24 either.