NEW DELHI, March 8: Fintech firm Infibeam Avenues Ltd’s UAE subsidiary has reorganised its shareholding structure ahead of its listing to amplify digital payment strategy, it said in a stock exchange filing.
The reorganization involves transferring the mirror shareholding in Avenues World FZ-LLC to its newly incorporated Abu Dhabi entity, Infibeam Avenues ME SPV Ltd.
As per the stock exchange filing of Thursday, Infibeam Avenues’ wholly-owned UAE subsidiary, Vavian International Ltd, will hold an 80 per cent stake in the newly-formed Infibeam Avenues ME SPV Ltd. This entity will, in turn, own Avenues World FZ-LLC, the operator behind the widely recognized CCAvenue.ae payment gateway in the UAE.
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According to market experts tracking the company, this strategic reshuffling aligns with Infibeam Avenues’ bullish outlook on the rapidly expanding digital payments sector in the Middle East and North Africa (MENA) region.
Over the past three years, the company’s CCAvenue.ae offering has gained considerable traction in the region.
The move is also aligned to the company’s plans to optimize its upcoming ADX IPO fundraising (Abu Dhabi Stock Exchange), which requires the company to have its headquarters in Abu Dhabi.
Infibeam Avenues Ltd had previously stated that its UAE-based step-down subsidiary, Avenues World FZ-LLC, raised up to USD 20 million in a pre-IPO equity placement. The 20 per cent dilution gave the firm a post-money valuation of USD 100 million.
According to a research analyst at a brokerage firm tracking Infibeam Avenues since 2016, the company’s UAE operations have undergone aggressive expansion, particularly in the past three years.
In August 2023, Infibeam Avenues had announced to have processed over AED 1 billion in transactions in a single month. By October 2023, its CCAvenue.ae payment gateway had processed more than AED 24.5 billion in transactions, serving over 5,000 merchants across various industries, including high-profile clients such as Burj Khalifa, Emaar, Damac, Nakheel, and Trump Golf Dubai.
A source said unlike India, the UAE’s digital payment landscape is heavily focused on high-commission transactions, with nearly all transactions being processed via debit/credit cards or net banking.
As per industry estimates, the UAE’s digital payments market is expected to grow at a compound annual growth rate (CAGR) of 8.02 per cent, reaching USD 39.13 billion by 2027, driven by the rapid adoption of e-commerce, mobile payments, and contactless transactions.
Capitalizing on this boom, Infibeam Avenues had introduced mobile-based QR code solutions in the UAE in 2023, targeting the growing offline payments sector. This launch marked a pivotal step for the company, as it expanded its portfolio of offerings into the international market, beginning with the UAE.
Infibeam’s strategic moves in the region have been further bolstered by a recent partnership between CCAvenue and PayPal, which aims to expand global payment acceptance across the MENA region.
Additionally, Infibeam’s subsidiary in Saudi Arabia recently secured the Payment Tokenization Service Provider (PTSP) certification from the Saudi Arabian Monetary Authority (SAMA), becoming one of the first Indian fintech firms to do so in the Kingdom.
In the FY24 (April 2023 to March 2024 financial year) earnings announcements, Infibeam Avenues had stated that its strategic focus will be on international expansion, particularly within the Middle East.
The company had also reported impressive year-on-year growth in the region, driven by the launch of initiatives such as express settlement for merchants, CCAvenue TapPay, and an aggressive expansion strategy targeting the digital payments boom in the Middle East.
“Based on commentary and public announcements over the past three years, coupled with the recent reorganization of its UAE subsidiaries, the company appears to be intensifying its focus on international markets to drive revenue growth,” an analyst at a prominent broking firm said, adding that this strategy begins with a targeted approach to capitalize on the lucrative digital payments market in the UAE.
On Friday, Infibeam Avenues stock closed at Rs 19.37, up by 1.57 per cent. (PTI)
