After the Paytm fiasco, I have dedicated not to invest in any future IPO's. Why? Markets are at all-time high. Every loss-making company is doing its IPO. Profitable companies such as Nykaa are getting crazy valuations that they will never achieve (don't quote me on this)
Paytm issue price was Rs 2,150 per share which is insane for a company that is consistently losing cash and its market share to other Payment Giants such as Google Pay and PhonePe. For them to achieve a profit cash flow they have to focus on one thing right now which is Payments, RN Paytm is doing everything from Stock brokerage to Paytm Mall there are cash-burning businesses.
This is explained very well by Akshat Shrivastava. Check out his video on Paytm
And also learn about Paytm's Valuations from Aswath Damodaran
Paytm listed at a discount of 9% at Rs 1,955 on the BSE, and closed at Rs 1,564.15, down by 27.24% from the IPO price. Trading of the scrip was halted after it hit the lower circuit in the latter half of market hours. - Indian Express
What's Next?
I will still buy stocks which I did in the case of Zomato and it has given me a 24% return but I will stay away from IPO's, And I would advise you also not to get the FOMO. I know 82% premium sounds good but cases such as in Paytm also occur where investors lost -24 % of their investment. Sometimes not investing is better investing.
At last, I want to tell you that I'm not a stock professional. I'm just an average Joe. Markets are volatile in nature and go up and down no one can predict the future.
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