IPO-bound Razorpay’s Parent Returns to India in Reverse Flip

Razorpay has completed the reverse flip of its parent company from the United States to India. The Bengaluru-based digital payments company informed its Board of Directors regarding the development. The Corporate Affairs Ministry has approved the merger between Razorpay Inc. and Razorpay Software Private Limited, the Economic Times reported, citing a company filing. 

This reportedly comes weeks after the digital payments firm received the board’s permission to convert itself into a public limited company, inching one step closer to public listing. The fintech unicorn had applied for the reverse flip under the amended rules, which require approval from the Reserve Bank of India (RBI) and Ministry of Corporate Affairs. 

The Bengaluru-based digital payments firm is aiming to become profitable by 2026 and eventually go for an initial public offering (IPO). The reverse flip of its parent firm aligns with its goal of going public. The company began reversing its corporate structure despite significant tax implications under the new rules that didn’t require permission from the National Company Law Tribunal (NCLT).

“There’s no challenge per se, it just takes time. The process is straightforward. We filed it via the fast checkout route. The NCLT process takes a while. The benches have a lot of cases to handle. The rules came out six months ago. We are testing waters, but this is expected to be faster,” Razorpay’s CEO Harshil Mathur had earlier told the Times of India. 

The route taken by Razorpay is similar to that of Groww and the broader trend of startups moving back to India. Last year in May 2024, Groww had reverse flipped its parent company from the US to India in May 2024 and has now filed for an IPO with the Securities and Exchange Board of India (Sebi) via a confidential route.