 "This recently listed stock soars 32% in 2 days; up 150% against issue price")
Shares of One Mobikwik Systems (Mobikwik) are continuing their upward trend, hitting a new high of Rs 698.30, and surging 15 per cent on the National Stock Exchange (NSE) in Thursday’s intra-day trade amid heavy volumes. On Tuesday’ the stock of the fintech company had zoomed 15 per cent. The stock was trading higher for the third straight day, soaring 43 per cent during this period.
With the past three days’ rally, the market price of Mobikwik has skyrocketed 150 per cent against its issue price of Rs 279 per share. Mobikwik shares had made a stellar debut on December 18, 2024, listing at Rs 528, an 89 per cent increase over its issue price.
At 01:59 PM; Mobikwik was trading 11 per cent higher at Rs 676.40, as compared to a marginal 0.05 per cent rise in the Nifty 50. As many as 78.56 million equity shares changed hands on the NSE (73.54 million) and BSE (5.02 million), the exchange data shows.
Thus far, the counter has recorded a combined turnover of Rs 5,168.69 crore, which accounts 98 per cent of the Mobikwik’s current market capitalisation of Rs 5,255 crore. On Tuesday, the counter had recorded a combined turnover of Rs 3,910 crore, the data shows.
As on December 16, 2024, mutual funds held 6.95 per cent stake in Mobikwik. Foreign portfolio investors have 6.19 per cent holding and resident individual shareholders held 9.83 per cent stake in the company, the shareholding pattern data shows.
Mobikwik is a technology-driven company that specialises in digital financial services and payment solutions. As of June 2024, the company has built a substantial user base of over 161 million and a wide merchant network of 4.26 million. Mobikwik provides a variety of services, including digital payments, credit, and investment products. The company has a vast reach, covering 99 per cent of India's pin codes.
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Mobikwik enjoys a strong brand presence and recognition in both large and small cities across India. With 72 per cent of digital loan disbursements in Tier 3+ locations, Mobikwik is bridging the financial gap and empowering underserved regions with modern financial services.
Mobikwik has raised Rs 572 crore through its initial public offer (IPO), which received enthusiastic participation from investors. The issue was oversubscribed by a whopping 119.38 times. The company in its Red Herring Prospectus (RHP) said that it will utilise the net proceeds from the IPO for funding growth in the financial services business, funding growth in the payment services business, investment in data, artificial intelligence (AI), machine learning (ML), product, and technology.
The company’s subsidiary, Zaak ePayment Services Private Limited (Zaakpay) functions as a payment gateway, processing transactions for both MobiKwik users and external merchants. The company has strategically shifted towards higher-margin financial services, capitalising on its existing payment services user base to fuel this transition. The company’s continued growth will depend on its ability to expand its financial services offerings, grow its merchant network, and navigate the evolving competitive and regulatory landscape in India’s fintech industry, according to analysts.
"Mobikwik operates in India's fast-growing digital payments and financial services market, which offers significant long-term growth opportunities. The company has strategically shifted towards higher-margin financial services, capitalising on its established payment user base to drive this transition. Its focus on promoting financial inclusion, particularly among the credit-underserved population, further strengthens its growth prospects," said KRChoksey Shares and Securities in IPO note.
In comparison to its peers like PhonePe, Paytm, and PayPal, MobiKwik significantly lags in registered user base and diversified service offerings. While the company has carved out a niche in ZIP and ZIP EMI offerings, with a growing Financial Services vertical and a low CAC/user, the company is poised to build and attract a bigger pie, the brokerage firm said in a report.