IPO ahead! Paramotor Digital Technology files updated draft papers with Sebi for Rs 1,000 crore issue

Paramotor Digital Technology, a financial technology company operating in digital gifting, consumer spend management and rewards and loyalty platforms, has filed its Updated Draft Red Herring Prospectus-I (UDRHP-I) with the Securities and Exchange Board of India (Sebi) for its proposed Rs 1,000 crore initial public offering (IPO).

The issue comprises a fresh issue of equity shares aggregating up to Rs 698 crore and an offer for sale (OFS) of up to Rs 302 crore. Promoter selling shareholders Sonia Pankaj Asher and Rahul Anand will each sell shares worth up to Rs 151 crore. The equity shares have a face value of Rs 10 apiece.

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The company may also consider a pre-IPO placement of up to Rs 139.60 crore. If undertaken, the amount raised through the placement will be adjusted against the fresh issue, subject to applicable regulations.

The net proceeds from the fresh issue will be used primarily for customer acquisition, retention, brand and business promotion initiatives, for which the company has earmarked Rs 355 crore. It has allocated Rs 94 crore towards technology development, cloud infrastructure services and information technology assets, and Rs 38 crore towards office infrastructure. The remaining proceeds will be used for general corporate purposes.

Paramotor Digital's proposed listing comes as it expands its presence across prepaid payment instruments (PPIs), digital gifting, rewards and loyalty solutions, and enterprise technology services.

The company's financial performance has expanded alongside the launch of new business verticals. Revenue from operations stood at Rs 3.31 crore in FY24 and Rs 11.21 crore in FY25 on a standalone basis, before increasing to Rs 60.31 crore in FY26 on a consolidated basis. Profit after tax (PAT) rose from Rs 4.94 crore in FY24 to Rs 24.51 crore in FY25 and Rs 59.14 crore in FY26, based on the respective standalone and consolidated financial statements.

For the three months ended June 30, 2026, the company reported consolidated revenue from operations of Rs 252.77 crore and PAT of Rs 23.81 crore. Earnings before interest, tax, depreciation and amortisation (EBITDA) stood at Rs 32.62 crore, with an EBITDA margin of 12.90%.

The company reported 1.58 million transacting users in FY26, compared with 43,269 in FY25 and 18,248 in FY24. Its user retention rate stood at 99% in FY26, against 87.98% in FY25 and 98.48% in FY24.

The Rewards and Loyalty business, launched in the second quarter of FY26, contributed Rs 414.23 crore, or 68.68%, of revenue from contracts with customers during the year. The PPI Program Management and Distribution business contributed Rs 154.16 crore, or 25.56%, while DevStack accounted for Rs 34.76 crore, or 5.76%. The prospectus uses different revenue-recognition bases across these businesses. Revenue from Rewards and Loyalty and DevStack is recognised on a gross basis, while fees from the PPI program management business are recognised on a net basis.

Motilal Oswal Investment Advisors Ltd and Equirus Capital Ltd are the book-running lead managers to the issue. MUFG Intime India Pvt Ltd is the registrar.

About Paramotor Digital Technology

Founded in 2016, Paramotor Digital Technology operates across prepaid payment instruments, digital gifting, rewards and loyalty solutions, and enterprise technology services. Its business comprises four offerings: SpendPro, a consumer spend management platform for prepaid card users; yayyy.shop, a digital marketplace for gift cards and reward points; RewardOn, a digital rewards and incentives platform for corporates; and DevStack, which provides customised enterprise software applications and technology development services.

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The company acts as a program manager, business correspondent and distribution agent for prepaid payment instruments issued by banks and Reserve Bank of India-licensed issuers. It also distributes non-reloadable branded gift cards issued by merchants. Its customers include PPI issuers, gift card aggregators, corporates running rewards and loyalty programmes, and clients of its DevStack business.

Disclosure: This article has been written by Kumar Gaurav, who is not a Sebi-registered Research Analyst or an Investment Adviser. Gaurav and their ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective Sebi-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here