SoftBank Bet On Indian Startups Like Paytm, Zomato — Now Its Looking To Cash In

The story was first published on the Benzinga India Portal.

SoftBank Group Corp SFTBY 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? The Masayoshi Son-led conglomerate 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.

On the Indian markets, Paytm has surged 66.8% so far this year, currently trading at INR 887.60 ($10.84), while Zomato has gained nearly 24% to sit at INR 74.65 ($0.91). The initial purchase prices for Zomato and Paytm were around INR 65 ($0.80)- INR 70 ($0.85) and INR 830 ($10.13) - INR 840 ($10.25) 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 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 for the financial 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 invested in the past six years.

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