As per ROC filing by Paytm, the Paytm has introduced new ESOP 2019 scheme for its employees for a period of 5 years. Under this scheme, the company will issue 2,42,904 shares worth Rs 357.66 crore. With this addition, the total count for ESOP in Paytm will increase to 2,166,524.
What is ESOP?
ESOP means employee stock options. Under this, the company issue shares to its employees generally at discount to the market value. This is a win-win situation for both the company and employees. The company gets the required funds for growth and expansion, on the other hand, the employees get the company's shares which they can encash to make good money in the future when its IPO comes.
For ex., When Flipkart was taken by Walmart for Rs 1 lakh crore, the employees holding the stock in their hands became very wealthy overnight.
When to apply for ESOP?
If an employee thinks that the company is performing well, the employee should buy these shares and keep until the company becomes big to turn their fortunes.
UnlistedZone View:
(i) The Paytm will issue these shares at ~Rs. 14600 per share as per information collected from ROC. Last year, they issued shares to Warren Buffet firm Berkshire Hathway for Rs. 12300 per share.
(ii) The big question is whether this ESOP 2019 scheme attracts employees?
Participation in the ESOP 2019 scheme by employees will give a lot of insight. The employees are a very important source of information about the health of the company.
We will keep you updating here once we get more information about ESOP 2019 scheme.