On February 11, data from the Bombay Stock Exchange showed that Alibaba.com Singapore E-Commerce has sold its remaining stake in Indian digital payments firm Paytm for about 13.78 billion rupees ($167.14 million) through a block deal.
Earlier, on January 13 this year, Alibaba.com Singapore E-Commerce sold 3.1% of its Paytm shares at a price of 536.95 rupees per share, with a transaction amount of $125 million.
This means that Alibaba has sold all of its Paytm’s shares, totaling 6.26%, since the February 10 deal. However, it is worth noting that Ant Group, an important affiliated company of Alibaba, has not diluted its Paytm shares currently totaling 25%.
Paytm is known as “Alipay” in India. In more than 550 cities in India, the system uses a blue QR code to serve local consumers and can be seen everywhere, such as gas stations, subway stations, parking lots, chain stores, retail outlets, and various online applications.
As early as 2015, Ant Group began to invest in Paytm, and helped it enter the fast lane of development by means of “cooperative shareholding and technology export”. Ant Group became the largest shareholder of Paytm, holding 25% of the shares. In addition, Alibaba held about 6% of the company’s shares. Looking back at Paytm’s growth history, the arrival of India’s mobile Internet era, the Modi government’s cash elimination, and the country’s unbalanced financial service system, have all become catalysts for Paytm’s rapid development.
Six years later, in November 2021, Paytm was officially listed on the Bombay Stock Exchange, raising more than $2.5 billion, which made it the largest IPO project in Indian history. According to the prospectus, as a populous country that is promoting digitalization, the prospect of the digital payment market in India is promising. Only about 25% of Indian people use mobile payment, and there are still 1 billion potential customers waiting to be discovered in the country.
From 2014 to 2020, Alibaba attached great importance to the Indian market and invested heavily in over nine technology giants in India, involving payments, e-commerce, government affairs, entertainment, travel and other fields. Until August 2020, Reuters reported that Alibaba had suspended its investment plan in Indian companies, and would not pour in new funds to expand its investment in India for at least six months. It also planned to reduce its shares in invested companies.
In less than two years, Alibaba has sold several investment projects in India. In early 2021, Alibaba sold a majority stake in online grocer BigBasket, which was taken over by Tata Group. In May 2022, Paytm Mall, the largest e-commerce company in India, announced that, with the strategic focus shifting from traditional physical e-commerce to B2B export and open network digital commerce, Alibaba, its largest shareholder, and Ant Group, the fourth largest shareholder, both withdrew from the company. In November 2022, Alipay Singapore sold a 3.07% stake in Zomato, an Indian-listed take-out platform, on the open market for 16.31 billion rupees.