Truecaller cofounders Alan Mamedi (L) and Nami Zarringhalam
Caller identification firm Truecaller, which earns majority of its revenues from India, made its trading debut at $6.82 (60 Swedish Krona) per share on Nasdaq Stockholm, up 15.4 percent from the company's listing price, giving the company a market cap of around $2.5 billion.
Earlier on October 8, Truecaller priced its public offering at $5.91 (52 Swedish krona), corresponding to a market cap of $2.2 billion (19,431 Swedish Krona). The firm was looking to mop up around $428.2 million (3,770 million Swedish Krona) through the offering, assuming the over-allotment option is exercised in full. Of this, the primary capital being raised is $114 million (1,000 Swedish Krona).
The firm set a price of 44-56 Swedish krona per share for its listing of Class B shares on September 29. It had first announced plans to list on Nasdaq Stockholm on September 15.
India is Truecaller's biggest market
Founded in 2009 by Alan Mamedi and Nami Zarringhalam, Truecaller claims to have 205.5 million monthly active users in India as of second quarter of 2021. It claims to be the third largest communication platform in the country by monthly active users behind WhatsApp and Facebook. The firm also says that 76.8 percent of its 215.5 million daily active users are located in India.
Overall, Truecaller claims to have 278.1 million monthly active users (MAUs) across over 175 countries as of second quarter of 2021. This has increased to 280 million users, Mamedi noted earlier today (October 8). The company has 266 employees as of June 30,2021, of which 148 employees are in India.
The Swedish firm has clocked revenues of $32.95 million (289.8 million Swedish krona) in India in the first six months of 2021, registering a 170.8 percent growth from $12.17 million (107.1 million Swedish krona) in the corresponding period in 2020. The country contributes about 69 percent of Truecaller's overall revenues.
The growth was driven by increased ad load, growth in new users, and optimisation of programmatic advertisements. That said, Truecaller noted that its revenues in the first half of 2020 were strongly impacted by the Covid-19 pandemic due to a decrease in call volumes.
Among its key investors include Sequoia Capital India, Atomico, Kleiner Perkins, and OpenOcean. Sequoia India had first invested in Truecaller in 2013 and is currently the largest shareholder in the company with a 20.8 percent stake. Founders Mamedi and Zarringhalam own 8.2 percent stake apiece prior to the offering.
Details of the offering
Through this IPO, the company is offering 53.4 million Class B shares (53,414,532 Class B shares), of which 19.23 million shares (19,230,770 shares) are newly issued shares and 34.18 million shares (34,183,762 Class B shares) are sold by existing shareholders including founders Mamedi and Zarringhalam and investors Sequoia Capital India, Atomico, and Kleiner Perkins. Employees are also offloading shares in this offering through different entities.
The offering includes an increased share offering of 9.63 million shares (9,628,948 shares), the Swedish firm noted. Investors Sequoia India, Atomico, Kleiner Perkins, OpenOcean and Zenith Venture Capital have also committed to sell up 9.46 million shares (9,456,520 Class B shares) in order to cover any over-allotments in relation to the offering, the firm said. If the over-allotment option is exercised in full, the offering will comprise a total of 72.5 million shares (72,500,000 Class B shares).
Truecaller has already secured anchor investment worth $257.4 million from Ward Ferry Management, Steadview Capital, Malabar Investments, The First Swedish National Pension Fund, Handelsbanken Fonder and Coeli Asset Management.
"Today marks a monumental milestone in Truecaller’s history. A fantastic journey began twelve years ago that has resulted in Truecaller becoming the leading global platform for verifying contacts and blocking unwanted communication with 280 million active users and more than half a billion app downloads. Now begins a new chapter to make tomorrow’s communication smarter, safer, and more efficient. Nami and I look forward to continuing Truecaller's growth journey together with existing and new shareholders" Mamedi said.
After listing, founders Zarringhalam and Mamedi will control a majority of the company's voting power due to their ownership of Truecaller’s high-vote Class A shares, the company had said on September 15.
The Swedish firm had stated plans to use the proceeds from the offering for future growth, explore potential acquisitions and for general corporate purposes. Truecaller said this offering would create opportunities for accelerated growth in line with its strategy, increase its financial flexibility and broaden its ownership base. Further, it said the listing would also increase awareness of Truecaller and its operations.
Truecaller's overall operating revenue in the first half of 2021 reached $49.51 million (425 million Swedish krona), an increase of 151 percent compared to the first half of 2020. Advertising makes up for 81.2 percent of its revenues from advertising and while user subscriptions account for 16.1 percent of the company's revenues. Other revenues which includes its nascent business offering Truecaller for Business contribute the remaining 2.66 percent of the revenues.
The firm posted a profit of $13.4 million for the six month ended 2021 as compared to a $4.1 million loss in the corresponding period in 2020.