Dec 31, 2024
December ESOP Roundup: Key Moves by Paytm, Zetwerk, and More as Companies Gear Up for 2025
The December ESOP Roundup highlights major equity-related moves by Paytm, Zetwerk, and other companies as they prepare for 2025.
Welcome back to another edition of Fables of ESOPs, where we bring you a monthly roundup of the latest activities and developments in the world of Employee Stock Ownership Plans (ESOPs). As we embark on a fresh year, we have witnessed a flurry of exciting ESOP allotments from various companies, reflecting their commitment to rewarding and retaining talent.
With the Indian budget set to be unveiled on February 1st, the anticipation is palpable within the startup and venture capital community. Many are hopeful for tax rationalization concerning ESOPs, which could significantly enhance their appeal and effectiveness as a tool for employee engagement. As discussions around double taxation continue to gain momentum, we eagerly await updates that could reshape the ESOP landscape. Stay tuned for our coverage of the budget announcements and their potential impact on ESOP policies in India!
In January 2025, several notable companies engaged in significant ESOP activities, showcasing their commitment to employee engagement and retention. Among these were Mphasis, Paytm, Brigade Enterprises, SIS, Zensar Technologies, and Swiggy. Each of these companies took steps to enhance their ESOP offerings, reflecting a broader trend in the industry to attract and reward talent as they prepare for future growth opportunities.
Yes Bank has recently allocated 2,011,762 equity shares under its Employee Stock Ownership Plan (ESOP) on January 17, 2025. Following this allocation, the bank's paid-up share capital has risen from ₹62,701,715,098 to ₹62,705,738,622. This change reflects an increase in the total number of equity shares from 31,350,857,549 to 31,352,869,311, with each share having a face value of ₹2.
Swiggy has allocated 26,193,411 equity shares under its Employee Stock Ownership Plan (ESOP) on January 25, 2025. Following this allotment, the company's paid-up equity share capital has increased from ₹2,238,447,311 to ₹2,264,640,722. As a result, the total number of equity shares has risen from 2,238,447,311 to 2,264,640,722, with each share having a face value of ₹1.
Zensar Technologies has allocated 116,475 equity shares under its Employee Stock Ownership Plan (ESOP) on January 31, 2025. As a result of this allotment, the company's issued and subscribed share capital has increased to ₹454,177,398, now comprising 227,088,699 equity shares, each valued at ₹2.
Paytm's parent company, One97 Communications, has expanded its Employee Stock Ownership Plan (ESOP) by allotting 203,137 stock options on January 18, 2025. Each stock option carries a face value of ₹1 and an exercise price of ₹9. Based on the closing price of One97 shares on that day, the total value of these options is approximately ₹18.27 crore. This marks the fourth round of ESOP allotments since Paytm returned to profitability in Q2 FY24, aided by the sale of its ticketing business to Zomato.
MapmyIndia has allocated 16,612 equity shares to employees under its Employee Stock Option Plan (ESOP). The shares were issued at an exercise price of ₹12.15 each, as stated in an exchange filing. The board approved this allotment of equity shares, each with a face value of ₹2, to employees who exercised their vested options in accordance with the company’s ESOP Policy from 2008.
Tata Motors' shares increased by 0.35% to ₹716 on the BSE after the company allotted 64,319 new ordinary shares to employees under its Employee Stock Option Plan (ESOP) on January 31, 2025. This allotment, which included shares issued upon the exercise of Performance Share Units and Stock Options, raised the company's paid-up share capital from ₹73,627,727,297 to ₹73,628,555,935. The newly issued shares will rank equally with existing ordinary shares.
Brigade Enterprises has allotted 122,430 equity shares under its Employee Stock Option Plan (ESOP) on January 29, 2025. This allotment has increased the company's paid-up share capital from ₹2,442,521,740 to ₹2,443,746,040.
SIS has allotted 700 equity shares under its Employee Stock Option Plan (ESOP) on January 27, 2025. This allotment has increased the company's paid-up equity share capital to ₹72,079,568, now comprising 14,415,913 equity shares, each valued at ₹5.
Mphasis has allotted 278,778 equity shares under its Employee Stock Option Plan (ESOP) and an additional 103 equity shares under its Restricted Stock Unit (RSU) plan on January 27, 2025.
The startup and venture capital community is advocating for the government to rationalize tax policies related to Employee Stock Ownership Plans (ESOPs) in the upcoming budget to eliminate double taxation. Currently, employees are taxed when they exercise their ESOPs and again when they sell the shares, which discourages participation. Industry representatives argue that removing the tax at the exercise stage would enhance the attractiveness of ESOPs, enabling companies to better reward their employees.
This request comes as several new-age companies prepare for public offerings, a time when ESOPs are commonly offered to attract and retain talent. The focus is on creating a more employee-friendly environment that supports the growth of India's startup ecosystem.
As we look ahead, ESOPs continues to play a crucial role in shaping employee engagement strategies across various industries. The upcoming budget holds the potential for significant changes that could enhance the attractiveness of ESOPs, making them an even more effective tool for talent retention.
Companies are increasingly recognizing the value of aligning employee interests with organizational success. Exciting times are ahead as we look forward to the budget announcements and their impact on the ESOP framework in India.
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