SoftBank Looks To Cash In On Paytm, Zomato Rally Via Stake Sale

SoftBank is reportedly set to sell stakes in Paytm and Zomato as the Japanese investment firm looks to turn a profit on its bets following a recent rally in their share prices.

What Happened? SoftBank plans to sell shares of Paytm parent One97 Communications and food aggregator Zomato gradually in smaller tranches on the open market rather than through a block deal, Moneycontrol reported, citing sources.

Paytm has surged 66.8% so far this year, currently trading at ₹887.60, while Zomato has gained nearly 24% to sit at ₹74.65. The initial purchase prices for Zomato and Paytm were around ₹65-₹70 and ₹830-₹840 per share, respectively.

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Holding an 11.17% stake in Paytm and 3.4% in Zomato, SoftBank is reportedly looking for partial exits from high-performing companies.

Earlier this week, the Japan-based firm sold a part of its stake in eyewear company Lenskart to private equity firm ChrysCapital, making the investment firm over $70 million (₹573.16 crore) from the stake sale, sources told the publication.

SoftBank’s active investments in Indian startups have slowed this year after a series of losses incurred by its Vision Funds, with a cautious and selective approach replacing its previously vigorous participation in Indian funding rounds.

SoftBank’s decision to sell the stakes comes days after it reported a record annual loss of $7.2 billion (₹58,962.60 crore) for the fiscal year ending March 2023.

Despite the losses, SoftBank remains a significant player in India’s tech investment landscape, with a history of backing startups with close to $12 billion (₹98,261.16 crore) invested in the past six years.

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