Former IDFC Securities star equity analyst Nikhil Vora has sold his entire stake in One97 Communications to Chinese e-commerce giant Alibaba earning ₹150 crore from his six year old investment. Mathematically, that is more than 75 times in returns from the sale of the meagre 0.35% stake or 1,60,000 shares in One97 Communications, the parent company of Paytm.
Vora quit IDFC securities and set up his own investment firm Sixth Sense Ventures back in February 2014. Despite selling his shares in One97, he continues to have a stake in Paytm E-commerce, which de-merged from its parent company earlier this year.
Vora’s equity sale to Alibaba was part of a larger secondary share sale round which included investors such as Saama Capital, Sapphire Ventures, and Reliance Capital also selling their One97 shares to Alibaba and its affiliate, Alipay. These companies together now own about 45% in One 97 Communications, which is a significant rise from the earlier 41% stake.
Vora had bought his stake in the digital payments wallet owner in 2011 after it cancelled its public offering as it wanted to move form being a mobile value-added services provider to a mobile internet firm. He confirmed the selling of his shares to Alibaba.
According to an Economic Times report in January, Vora had been intending to cash in on One97 Communication’s rising valuation and had been in talks with Hero Group’s Sunil Munjal and Saroj Poddar, the chairman of fertiliser and engineering services conglomerate Adventz Group.
According to the secondary sales, One97’s pre-money valuation is currently at about $7 billion. It plans to raise $1.4-1.9 billion from Japan’s SoftBank at a valuation of $8-9 billion.
Vora plans to launch a second venture fund of undisclosed size as well as a 250 crore public markets fund that will focus on the consumer market. He plans to do this within the next two-three months.
His firm’s current maiden fund Sixth Sense India Opportunities-1, has made eight investments so far and counts Small Industries Development Bank of India (SIDBI) as its main investor. Instances of the company’s recent investments include LEAP India, a Mumbai-based supply chain solutions company, and Soothe Healthcare, which makes the Paree brand sanitary napkins. In a statement, Vora said,
Six companies in our portfolio have already seen a new round at a higher valuation.
The firm has also invested inn luxury watch retail chain operator Ethos and Cross Roads Assistance, a company that provides road-side assistance for two-wheelers and cars. In addition to the numerous investments made by his company, Vora has also been a personal investor in several privately held companies.
These personal investments include Vini Cosmetics, a Sequoia Capital India-backed consumer goods company that sells the deodorant brand Fogg; online cosmetics retailer Purplle; and Air Works, an aviation maintenance and overhaul services provider that is backed by private equity firms New Enterprise Associates and GTI Capital, and pre-school chain Kangaroo Kids, which was recently acquired by rival Eurokids.