Razorpay IPO
IPO Price Range: Not Announced Yet
IPO Status
Upcoming
Listing Exchange
BSE
Objectives of IPO
- Razorpay has confidentially filed draft papers for an IPO that is expected to raise around ₹5,700 crore (about $600 million), as per media reports. The issue is likely to include a fresh issue of roughly ₹2,700 crore, where the company will receive the funds, along with an Offer for Sale (OFS), where existing investors such as Tiger Global and Peak XV Partners may sell part of their holdings.
- Since the filing has been made through the confidential route, the detailed use of funds has not been made public yet. However, Razorpay has indicated that it plans to use the money to expand its international business, build and improve products such as its offline POS machines and RazorpayX platform, and meet general corporate requirements as it continues to grow.
Financial Performance of Razorpay
The company delivered strong revenue growth in the latest financial year, with total revenue rising 59.5% to ₹3,932.1 crore in FY25. According to its financial statements, this growth was largely driven by higher demand for its core payment processing business, along with a sharp increase in sales of point-of-sale (POS) devices and prepaid cards. Interestingly, despite this rapid growth in revenue, the company's total assets remained almost unchanged, increasing by just 0.2% to ₹5,303.9 crore.
Despite the strong jump in revenue, the company reported a higher net loss for the year. Total losses increased by 5.7% to ₹1,206.1 crore from ₹1,141.0 crore in the previous year. A major reason for this was a set of one-time expenses, including significant tax and stamp duty costs linked to the restructuring that merged its US holding company with the Indian entity. Rising transaction-processing costs also added pressure on profitability.
That said, there were signs of improving operating efficiency. The EBITDA margin (a measure of profitability before interest, taxes, depreciation, and amortisation) improved from -13.06% to -3.12%, while the net profit margin improved from -49.69% to -31.88%. In simple words, although the company was still making losses, its revenue grew much faster than its losses, helping overall margins move in the right direction.
Strengths and Risks
Strengths
Razorpay delivered strong revenue growth, with operating revenue rising to ₹3,782.83 crore in FY25 from ₹2,296.18 crore a year earlier. This sharp increase suggests that more businesses are relying on its payment and financial services than ever before.
The company sits on a strong cash position, holding ₹2,774.09 crore in cash and cash equivalents. This gives Razorpay plenty of flexibility to fund day-to-day operations, invest in new products, and navigate challenging economic conditions without needing immediate external funding.
Beyond its software offerings, Razorpay has rapidly expanded its hardware business. Revenue from prepaid cards and Point of Sale (POS) machines jumped to ₹442.39 crore in FY25 from just ₹21.05 crore in the previous year, creating a meaningful new source of income.
The company's ability to collect payments from customers has improved significantly. Its trade receivables turnover ratio, a measure of how quickly a company converts sales into cash, increased to 25.50 from 15.64. In simple words, Razorpay is getting paid much faster than before; one of the key reasons was also the increasing revenue of the company.
Risks
Despite strong revenue growth, Razorpay is still losing money. Its net loss widened to ₹1,206.14 crore in FY25 from ₹1,140.97 crore in the previous year, showing that the company has not yet reached a point where it can generate profits.
The cost of running its core payments business is rising quickly. Direct expenses, mainly payment processing and settlement charges, climbed to ₹2,505.95 crore from ₹1,390.61 crore. As these costs grow, they take a bigger bite out of the company's earnings.
Razorpay's decision to shift its corporate structure back to India came at a significant cost. As part of this process, the company recorded a one-time tax expense of ₹722.50 crore, which had a major impact on its financial results for the year.
Its short-term financial position has become a bit tighter. The current ratio, which measures a company's ability to meet near-term obligations, fell from 2.77 to 1.69. A large part of this decline was due to tax liabilities created during the corporate restructuring process.
How to Apply for Razorpay IPO on INDmoney
- Download the INDmoney app and complete your KYC.
- Go to INDstocks → IPO, or just search “IPO”.
- Tap on Razorpay IPO from the list of live IPOs.
- View key details like price band, lot size, and dates.
- Tap Apply Now and choose your number of lots.
- Use INDpay UPI for instant mandate tracking.
- Your funds will be blocked until the share allotment is finalized.
About Razorpay
You can think of Razorpay as a financial bridge between buyers and sellers. When a customer makes a payment online, Razorpay collects the money from the customer's bank account or credit card, keeps a small fee for its service, and then transfers the remaining amount to the business. This saves merchants from dealing with the complicated rules and technical requirements of the payments industry and allows them to accept payments smoothly across different channels.
Most of Razorpay's revenue comes from these payment processing fees. Out of its total operating revenue of ₹3,782.83 crore in FY25, around ₹3,326.79 crore came from its core payment services. The company also earns money by selling Point of Sale (POS) machines, which are card-swiping devices used in stores, and prepaid cards. Together, these contributed another ₹442.39 crore in revenue. Beyond payment collection, Razorpay also offers a payouts platform that helps businesses pay employees, vendors, and suppliers quickly and efficiently.
Although Razorpay operates mainly in India, where it generates almost all of its revenue and enjoys strong brand recognition, it also serves businesses in Malaysia. One reason its business model stands out is that it offers a broader set of tools beyond payments. For example, it uses artificial intelligence (AI) software to help online businesses identify potentially fraudulent or risky orders before they are completed. Looking ahead, Razorpay is expanding its offerings through acquisitions in the digital billing space and has also been reorganizing its corporate structure as it prepares for a possible stock market listing via IPO in India.
For more details, visit here: https://razorpay.com
Frequently Asked Questions of Razorpay IPO
Can we invest in Razorpay IPO?
What would be the listing gains on the Razorpay IPO?
What is 'pre-apply' for Razorpay IPO?
When is the Razorpay IPO coming?
Razorpay has not announced an official IPO date yet. The company confidentially filed its Draft Red Herring Prospectus (DRHP) on June 12, 2026, and is reportedly looking to raise up to ₹5,700 crore, with ₹2,700 crore through a fresh issue, along with an offer for sale by existing shareholders. Subject to regulatory approvals, the company is targeting a stock market listing by the end of 2026.
Who are the promoters of Razorpay?
Razorpay was founded by Harshil Mathur and Shashank Kumar in 2014, and they continue to be the key people leading the business. Following the company's "reverse flip" restructuring, which shifted its holding structure back to India, the founders remain at the center of Razorpay's growth plans and its transition toward becoming a publicly listed company.
Who are the competitors of Razorpay?
Razorpay operates in a highly competitive digital payments market. Some of its biggest competitors include Paytm, PhonePe, Pine Labs, and PayU. These companies compete across areas such as online payment gateways, point-of-sale (POS) machines, merchant payments, and business banking solutions.
How does Razorpay make money?
Razorpay earns most of its revenue by charging businesses a fee whenever they process payments through its platform. Last year, its core payment and related services generated ₹3,326.79 crore in revenue. The company also earned ₹442.39 crore from selling prepaid cards and POS machines. Beyond payments, Razorpay offers a wider range of financial tools for businesses. It generates revenue through merchant transaction fees, POS device charges, subscriptions for products such as payroll and business banking software, and income from lending and other financial services offered to merchants.